G.R. No. 168056 September 1, 2005
LEE doing business under the name and style of "NTE
ABAKADA GURO PARTY LIST (Formerly AASJAS) OFFICERS
SAMSON S. ALCANTARA and ED VINCENT S. ALBANO, Petitioners,
vs.
THE HONORABLE EXECUTIVE SECRETARY EDUARDO ERMITA;
HONORABLE SECRETARY OF THE DEPARTMENT OF FINANCE
CESAR PURISIMA; and HONORABLE COMMISSIONER OF
INTERNAL REVENUE GUILLERMO PARAYNO, JR., Respondent.
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G.R. No. 168207
AQUILINO Q. PIMENTEL, JR., LUISA P. EJERCITO-ESTRADA,
JINGGOY E. ESTRADA, PANFILO M. LACSON, ALFREDO S. LIM,
JAMBY A.S. MADRIGAL, AND SERGIO R. OSMEÑA III, Petitioners,
vs.
EXECUTIVE SECRETARY EDUARDO R. ERMITA, CESAR V.
PURISIMA, SECRETARY OF FINANCE, GUILLERMO L. PARAYNO,
JR., COMMISSIONER OF THE BUREAU OF INTERNAL
REVENUE, Respondent.
x-------------------------x
G.R. No. 168461
ASSOCIATION OF PILIPINAS SHELL DEALERS, INC. represented by
its President, ROSARIO ANTONIO; PETRON DEALERS’ ASSOCIATION
represented by its President, RUTH E. BARBIBI; ASSOCIATION OF
CALTEX DEALERS’ OF THE PHILIPPINES represented by its President,
MERCEDITAS A. GARCIA; ROSARIO ANTONIO doing business under
the name and style of "ANB NORTH SHELL SERVICE STATION";
LOURDES MARTINEZ doing business under the name and style of
"SHELL GATE – N. DOMINGO"; BETHZAIDA TAN doing business under
the name and style of "ADVANCE SHELL STATION"; REYNALDO P.
MONTOYA doing business under the name and style of "NEW LAMUAN
SHELL SERVICE STATION"; EFREN SOTTO doing business under the
name and style of "RED FIELD SHELL SERVICE STATION"; DONICA
CORPORATION represented by its President, DESI TOMACRUZ; RUTH
E. MARBIBI doing business under the name and style of "R&R PETRON
STATION"; PETER M. UNGSON doing business under the name and
style of "CLASSIC STAR GASOLINE SERVICE STATION"; MARIAN
SHEILA A.
GASOLINE & SERVICE STATION"; JULIAN CESAR P. POSADAS doing
business under the name and style of "STARCARGA ENTERPRISES";
ADORACION MAÑEBO doing business under the name and style of
"CMA MOTORISTS CENTER"; SUSAN M. ENTRATA doing business
under the name and style of "LEONA’S GASOLINE STATION and
SERVICE CENTER"; CARMELITA BALDONADO doing business under
the name and style of "FIRST CHOICE SERVICE CENTER";
MERCEDITAS A. GARCIA doing business under the name and style of
"LORPED SERVICE CENTER"; RHEAMAR A. RAMOS doing business
under the name and style of "RJRAM PTT GAS STATION"; MA. ISABEL
VIOLAGO doing business under the name and style of "VIOLAGO-PTT
SERVICE CENTER"; MOTORISTS’ HEART CORPORATION
represented by its Vice-President for Operations, JOSELITO F.
FLORDELIZA; MOTORISTS’ HARVARD CORPORATION represented
by its Vice-President for Operations, JOSELITO F. FLORDELIZA;
MOTORISTS’ HERITAGE CORPORATION represented by its Vice-
President for Operations, JOSELITO F. FLORDELIZA; PHILIPPINE
STANDARD OIL CORPORATION represented by its Vice-President for
Operations, JOSELITO F. FLORDELIZA; ROMEO MANUEL doing
business under the name and style of "ROMMAN GASOLINE STATION";
ANTHONY ALBERT CRUZ III doing business under the name and style
of "TRUE SERVICE STATION", Petitioners,
vs.
CESAR V. PURISIMA, in his capacity as Secretary of the Department
of Finance and GUILLERMO L. PARAYNO, JR., in his capacity as
Commissioner of Internal Revenue, Respondent.
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G.R. No. 168463
FRANCIS JOSEPH G. ESCUDERO, VINCENT CRISOLOGO,
EMMANUEL JOEL J. VILLANUEVA, RODOLFO G. PLAZA, DARLENE
ANTONINO-CUSTODIO, OSCAR G. MALAPITAN, BENJAMIN C.
AGARAO, JR. JUAN EDGARDO M. ANGARA, JUSTIN MARC SB.
CHIPECO, FLORENCIO G. NOEL, MUJIV S. HATAMAN, RENATO B.
MAGTUBO, JOSEPH A. SANTIAGO, TEOFISTO DL. GUINGONA III,
RUY ELIAS C. LOPEZ, RODOLFO Q. AGBAYANI and TEODORO A.
CASIÑO, Petitioners,
vs.
CESAR V. PURISIMA, in his capacity as Secretary of Finance,
GUILLERMO L. PARAYNO, JR., in his capacity as Commissioner of
Internal Revenue, and EDUARDO R. ERMITA, in his capacity as
Executive Secretary, Respondent.
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G.R. No. 168730
BATAAN GOVERNOR ENRIQUE T. GARCIA, JR. Petitioner,
vs.
HON. EDUARDO R. ERMITA, in his capacity as the Executive Secretary;
HON. MARGARITO TEVES, in his capacity as Secretary of Finance;
HON. JOSE MARIO BUNAG, in his capacity as the OIC Commissioner of
the Bureau of Internal Revenue; and HON. ALEXANDER AREVALO, in
his capacity as the OIC Commissioner of the Bureau of Customs,
Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
The expenses of government, having for their object the interest of all,
should be borne by everyone, and the more man enjoys the advantages
of society, the more he ought to hold himself honored in contributing to
those expenses.
-Anne Robert Jacques Turgot (1727-1781)
French statesman and economist
Mounting budget deficit, revenue generation, inadequate fiscal allocation
for education, increased emoluments for health workers, and wider
coverage for full value-added tax benefits … these are the reasons why
Republic Act No. 9337 (R.A. No. 9337)1 was enacted. Reasons, the
wisdom of which, the Court even with its extensive constitutional power of
review, cannot probe. The petitioners in these cases, however, question
not only the wisdom of the law, but also perceived constitutional
infirmities in its passage.
Every law enjoys in its favor the presumption of constitutionality. Their
arguments notwithstanding, petitioners failed to justify their call for the
invalidity of the law. Hence, R.A. No. 9337 is not unconstitutional.
LEGISLATIVE HISTORY
R.A. No. 9337 is a consolidation of three legislative bills namely, House
Bill Nos. 3555 and 3705, and Senate Bill No. 1950.
House Bill No. 35552 was introduced on first reading on January 7,
2005. The House Committee on Ways and Means approved the bill, in
substitution of House Bill No. 1468, which Representative (Rep.) Eric D.
Singson introduced on August 8, 2004. The President certified the bill on
January 7, 2005 for immediate enactment. On January 27, 2005, the
House of Representatives approved the bill on second and third reading.
House Bill No. 37053 on the other hand, substituted House Bill No. 3105
introduced by Rep. Salacnib F. Baterina, and House Bill No. 3381
introduced by Rep. Jacinto V. Paras. Its "mother bill" is House Bill No.
3555. The House Committee on Ways and Means approved the bill on
February 2, 2005. The President also certified it as urgent on February 8,
2005. The House of Representatives approved the bill on second and
third reading on February 28, 2005.
Meanwhile, the Senate Committee on Ways and Means
approved Senate Bill No. 19504 on March 7, 2005, "in substitution of
Senate Bill Nos. 1337, 1838 and 1873, taking into consideration House
Bill Nos. 3555 and 3705." Senator Ralph G. Recto sponsored Senate Bill
No. 1337, while Senate Bill Nos. 1838 and 1873 were both sponsored by
Sens. Franklin M. Drilon, Juan M. Flavier and Francis N. Pangilinan. The
President certified the bill on March 11, 2005, and was approved by the
Senate on second and third reading on April 13, 2005.
On the same date, April 13, 2005, the Senate agreed to the request of
the House of Representatives for a committee conference on the
disagreeing provisions of the proposed bills.
Before long, the Conference Committee on the Disagreeing Provisions of
House Bill No. 3555, House Bill No. 3705, and Senate Bill No. 1950,
"after having met and discussed in full free and conference,"
recommended the approval of its report, which the Senate did on May 10,
2005, and with the House of Representatives agreeing thereto the next
day, May 11, 2005.
On May 23, 2005, the enrolled copy of the consolidated House and
Senate version was transmitted to the President, who signed the same
into law on May 24, 2005. Thus, came R.A. No. 9337.
July 1, 2005 is the effectivity date of R.A. No. 9337. 5 When said date
came, the Court issued a temporary restraining order, effective
immediately and continuing until further orders, enjoining respondents
from enforcing and implementing the law.
Oral arguments were held on July 14, 2005. Significantly, during the
hearing, the Court speaking through Mr. Justice Artemio V. Panganiban,
voiced the rationale for its issuance of the temporary restraining order on
July 1, 2005, to wit:
J. PANGANIBAN : . . . But before I go into the details of your
presentation, let me just tell you a little background. You know when the
law took effect on July 1, 2005, the Court issued a TRO at about 5
o’clock in the afternoon. But before that, there was a lot of complaints
aired on television and on radio. Some people in a gas station were
complaining that the gas prices went up by 10%. Some people were
complaining that their electric bill will go up by 10%. Other times people
riding in domestic air carrier were complaining that the prices that they’ll
have to pay would have to go up by 10%. While all that was being aired,
per your presentation and per our own understanding of the law, that’s
not true. It’s not true that the e-vat law necessarily increased prices by
10% uniformly isn’t it?
ATTY. BANIQUED : No, Your Honor.
J. PANGANIBAN : It is not?
ATTY. BANIQUED : It’s not, because, Your Honor, there is an Executive
Order that granted the Petroleum companies some subsidy . . .
interrupted
J. PANGANIBAN : That’s correct . . .
ATTY. BANIQUED : . . . and therefore that was meant to temper the
impact . . . interrupted
J. PANGANIBAN : . . . mitigating measures . . .
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : As a matter of fact a part of the mitigating measures
would be the elimination of the Excise Tax and the import duties. That is
why, it is not correct to say that the VAT as to petroleum dealers
increased prices by 10%.
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : And therefore, there is no justification for increasing
the retail price by 10% to cover the E-Vat tax. If you consider the excise
tax and the import duties, the Net Tax would probably be in the
neighborhood of 7%? We are not going into exact figures I am just trying
to deliver a point that different industries, different products, different
services are hit differently. So it’s not correct to say that all prices must go
up by 10%.
ATTY. BANIQUED : You’re right, Your Honor.
J. PANGANIBAN : Now. For instance, Domestic Airline companies, Mr.
Counsel, are at present imposed a Sales Tax of 3%. When this E-Vat law
took effect the Sales Tax was also removed as a mitigating measure. So,
therefore, there is no justification to increase the fares by 10% at best
7%, correct?
ATTY. BANIQUED : I guess so, Your Honor, yes.
J. PANGANIBAN : There are other products that the people were
complaining on that first day, were being increased arbitrarily by 10%.
And that’s one reason among many others this Court had to issue TRO
because of the confusion in the implementation. That’s why we added as
an issue in this case, even if it’s tangentially taken up by the pleadings of
the parties, the confusion in the implementation of the E-vat. Our people
were subjected to the mercy of that confusion of an across the board
increase of 10%, which you yourself now admit and I think even the
Government will admit is incorrect. In some cases, it should be 3% only,
in some cases it should be 6% depending on these mitigating measures
and the location and situation of each product, of each service, of each
company, isn’t it?
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : Alright. So that’s one reason why we had to issue a
TRO pending the clarification of all these and we wish the government
will take time to clarify all these by means of a more detailed
implementing rules, in case the law is upheld by this Court. . . . 6
The Court also directed the parties to file their respective Memoranda.
G.R. No. 168056
Before R.A. No. 9337 took effect, petitioners ABAKADA GURO Party List,
et al., filed a petition for prohibition on May 27, 2005. They question the
constitutionality of Sections 4, 5 and 6 of R.A. No. 9337, amending
Sections 106, 107 and 108, respectively, of the National Internal
Revenue Code (NIRC). Section 4 imposes a 10% VAT on sale of goods
and properties, Section 5 imposes a 10% VAT on importation of goods,
and Section 6 imposes a 10% VAT on sale of services and use or lease
of properties. These questioned provisions contain a
uniform proviso authorizing the President, upon recommendation of the
Secretary of Finance, to raise the VAT rate to 12%, effective January 1,
2006, after any of the following conditions have been satisfied, to wit:
. . . That the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-added
tax to twelve percent (12%), after any of the following conditions has
been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth percent (2
4/5%); or
(ii) National government deficit as a percentage of GDP of the previous
year exceeds one and one-half percent (1 ½%).
Petitioners argue that the law is unconstitutional, as it constitutes
abandonment by Congress of its exclusive authority to fix the rate of
taxes under Article VI, Section 28(2) of the 1987 Philippine Constitution.
G.R. No. 168207
On June 9, 2005, Sen. Aquilino Q. Pimentel, Jr., et al., filed a petition
for certiorari likewise assailing the constitutionality of Sections 4, 5 and 6
of R.A. No. 9337.
Aside from questioning the so-called stand-by authority of the President
to increase the VAT rate to 12%, on the ground that it amounts to an
undue delegation of legislative power, petitioners also contend that the
increase in the VAT rate to 12% contingent on any of the two conditions
being satisfied violates the due process clause embodied in Article III,
Section 1 of the Constitution, as it imposes an unfair and additional tax
burden on the people, in that: (1) the 12% increase is ambiguous
because it does not state if the rate would be returned to the original 10%
if the conditions are no longer satisfied; (2) the rate is unfair and
unreasonable, as the people are unsure of the applicable VAT rate from
year to year; and (3) the increase in the VAT rate, which is supposed to
be an incentive to the President to raise the VAT collection to at least
2 4/5 of the GDP of the previous year, should only be based on fiscal
adequacy.
Petitioners further claim that the inclusion of a stand-by authority granted
to the President by the Bicameral Conference Committee is a violation of
the "no-amendment rule" upon last reading of a bill laid down in Article VI,
Section 26(2) of the Constitution.
G.R. No. 168461
Thereafter, a petition for prohibition was filed on June 29, 2005, by the
Association of Pilipinas Shell Dealers, Inc., et al., assailing the following
provisions of R.A. No. 9337:
1) Section 8, amending Section 110 (A)(2) of the NIRC, requiring that the
input tax on depreciable goods shall be amortized over a 60-month
period, if the acquisition, excluding the VAT components, exceeds One
Million Pesos (₱1, 000,000.00);
2) Section 8, amending Section 110 (B) of the NIRC, imposing a 70%
limit on the amount of input tax to be credited against the output tax; and
3) Section 12, amending Section 114 (c) of the NIRC, authorizing the
Government or any of its political subdivisions, instrumentalities or
agencies, including GOCCs, to deduct a 5% final withholding tax on
gross payments of goods and services, which are subject to 10% VAT
under Sections 106 (sale of goods and properties) and 108 (sale of
services and use or lease of properties) of the NIRC.
Petitioners contend that these provisions are unconstitutional for being
arbitrary, oppressive, excessive, and confiscatory.
Petitioners’ argument is premised on the constitutional right of non-
deprivation of life, liberty or property without due process of law under
Article III, Section 1 of the Constitution. According to petitioners, the
contested sections impose limitations on the amount of input tax that may
be claimed. Petitioners also argue that the input tax partakes the nature
of a property that may not be confiscated, appropriated, or limited without
due process of law. Petitioners further contend that like any other
property or property right, the input tax credit may be transferred or
disposed of, and that by limiting the same, the government gets to tax a
profit or value-added even if there is no profit or value-added.
Petitioners also believe that these provisions violate the constitutional
guarantee of equal protection of the law under Article III, Section 1 of the
Constitution, as the limitation on the creditable input tax if: (1) the entity
has a high ratio of input tax; or (2) invests in capital equipment; or (3) has
several transactions with the government, is not based on real and
substantial differences to meet a valid classification.
Lastly, petitioners contend that the 70% limit is anything but progressive,
violative of Article VI, Section 28(1) of the Constitution, and that it is the
smaller businesses with higher input tax to output tax ratio that will suffer
the consequences thereof for it wipes out whatever meager margins the
petitioners make.
G.R. No. 168463
Several members of the House of Representatives led by Rep. Francis
Joseph G. Escudero filed this petition for certiorari on June 30, 2005.
They question the constitutionality of R.A. No. 9337 on the following
grounds:
1) Sections 4, 5, and 6 of R.A. No. 9337 constitute an undue delegation
of legislative power, in violation of Article VI, Section 28(2) of the
Constitution;
2) The Bicameral Conference Committee acted without jurisdiction in
deleting the no pass on provisions present in Senate Bill No. 1950 and
House Bill No. 3705; and
3) Insertion by the Bicameral Conference Committee of Sections 27, 28,
34, 116, 117, 119, 121, 125,7 148, 151, 236, 237 and 288, which were
present in Senate Bill No. 1950, violates Article VI, Section 24(1) of the
Constitution, which provides that all appropriation, revenue or tariff bills
shall originate exclusively in the House of Representatives
G.R. No. 168730
On the eleventh hour, Governor Enrique T. Garcia filed a petition
for certiorari and prohibition on July 20, 2005, alleging unconstitutionality
of the law on the ground that the limitation on the creditable input tax in
effect allows VAT-registered establishments to retain a portion of the
taxes they collect, thus violating the principle that tax collection and
revenue should be solely allocated for public purposes and expenditures.
Petitioner Garcia further claims that allowing these establishments to
pass on the tax to the consumers is inequitable, in violation of Article VI,
Section 28(1) of the Constitution.
RESPONDENTS’ COMMENT
The Office of the Solicitor General (OSG) filed a Comment in behalf of
respondents. Preliminarily, respondents contend that R.A. No. 9337
enjoys the presumption of constitutionality and petitioners failed to cast
doubt on its validity.
Relying on the case of Tolentino vs. Secretary of Finance, 235 SCRA
630 (1994), respondents argue that the procedural issues raised by
petitioners, i.e., legality of the bicameral proceedings, exclusive
origination of revenue measures and the power of the Senate
concomitant thereto, have already been settled. With regard to the issue
of undue delegation of legislative power to the President, respondents
contend that the law is complete and leaves no discretion to the
President but to increase the rate to 12% once any of the two conditions
provided therein arise.
Respondents also refute petitioners’ argument that the increase to 12%,
as well as the 70% limitation on the creditable input tax, the 60-month
amortization on the purchase or importation of capital goods exceeding
₱1,000,000.00, and the 5% final withholding tax by government
agencies, is arbitrary, oppressive, and confiscatory, and that it violates
the constitutional principle on progressive taxation, among others.
Finally, respondents manifest that R.A. No. 9337 is the anchor of the
government’s fiscal reform agenda. A reform in the value-added system
of taxation is the core revenue measure that will tilt the balance towards a
sustainable macroeconomic environment necessary for economic growth.
ISSUES
The Court defined the issues, as follows:
 PROCEDURAL ISSUE to someone else.11 Examples are individual and corporate income taxes,
transfer taxes, and residence taxes.12
Whether R.A. No. 9337 violates the following provisions of the
Constitution: In the Philippines, the value-added system of sales taxation has long
been in existence, albeit in a different mode. Prior to 1978, the system
a. Article VI, Section 24, and was a single-stage tax computed under the "cost deduction method" and
was payable only by the original sellers. The single-stage system was
b. Article VI, Section 26(2) subsequently modified, and a mixture of the "cost deduction method" and
"tax credit method" was used to determine the value-added tax
payable.13 Under the "tax credit method," an entity can credit against or
SUBSTANTIVE ISSUES
subtract from the VAT charged on its sales or outputs the VAT paid on its
purchases, inputs and imports.14
1. Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections
106, 107 and 108 of the NIRC, violate the following provisions of the
It was only in 1987, when President Corazon C. Aquino issued Executive
Constitution:
Order No. 273, that the VAT system was rationalized by imposing a multi-
stage tax rate of 0% or 10% on all sales using the "tax credit method." 15
a. Article VI, Section 28(1), and
E.O. No. 273 was followed by R.A. No. 7716 or the Expanded VAT
b. Article VI, Section 28(2) Law,16 R.A. No. 8241 or the Improved VAT Law,17 R.A. No. 8424 or the
Tax Reform Act of 1997,18 and finally, the presently beleaguered R.A. No.
2. Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 9337, also referred to by respondents as the VAT Reform Act.
110(B) of the NIRC; and Section 12 of R.A. No. 9337, amending Section
114(C) of the NIRC, violate the following provisions of the Constitution: The Court will now discuss the issues in logical sequence.

a. Article VI, Section 28(1), and PROCEDURAL ISSUE

b. Article III, Section 1 I.

RULING OF THE COURT Whether R.A. No. 9337 violates the following provisions of the
Constitution:
As a prelude, the Court deems it apt to restate the general principles and
concepts of value-added tax (VAT), as the confusion and inevitably, a. Article VI, Section 24, and
litigation, breeds from a fallacious notion of its nature.
b. Article VI, Section 26(2)
The VAT is a tax on spending or consumption. It is levied on the sale,
barter, exchange or lease of goods or properties and services. 8 Being an
A. The Bicameral Conference Committee
indirect tax on expenditure, the seller of goods or services may pass on
the amount of tax paid to the buyer,9 with the seller acting merely as a tax
collector.10 The burden of VAT is intended to fall on the immediate buyers Petitioners Escudero, et al., and Pimentel, et al., allege that the
and ultimately, the end-consumers. Bicameral Conference Committee exceeded its authority by:

In contrast, a direct tax is a tax for which a taxpayer is directly liable on 1) Inserting the stand-by authority in favor of the President in Sections 4,
the transaction or business it engages in, without transferring the burden 5, and 6 of R.A. No. 9337;
2) Deleting entirely the no pass-on provisions found in both the House
and Senate bills;
3) Inserting the provision imposing a 70% limit on the amount of input tax
to be credited against the output tax; and
4) Including the amendments introduced only by Senate Bill No. 1950
regarding other kinds of taxes in addition to the value-added tax.
Petitioners now beseech the Court to define the powers of the Bicameral
Conference Committee.
It should be borne in mind that the power of internal regulation and
discipline are intrinsic in any legislative body for, as unerringly elucidated
by Justice Story, "[i]f the power did not exist, it would be utterly
impracticable to transact the business of the nation, either at all, or
at least with decency, deliberation, and order."19 Thus, Article VI,
Section 16 (3) of the Constitution provides that "each House may
determine the rules of its proceedings." Pursuant to this inherent
constitutional power to promulgate and implement its own rules of
procedure, the respective rules of each house of Congress provided for
the creation of a Bicameral Conference Committee.
Thus, Rule XIV, Sections 88 and 89 of the Rules of House of
Representatives provides as follows:
Sec. 88. Conference Committee. – In the event that the House does not
agree with the Senate on the amendment to any bill or joint resolution,
the differences may be settled by the conference committees of both
chambers.
In resolving the differences with the Senate, the House panel shall, as
much as possible, adhere to and support the House Bill. If the differences
with the Senate are so substantial that they materially impair the House
Bill, the panel shall report such fact to the House for the latter’s
appropriate action.
Sec. 89. Conference Committee Reports. – . . . Each report shall contain
a detailed, sufficiently explicit statement of the changes in or
amendments to the subject measure.
...
The Chairman of the House panel may be interpellated on the
Conference Committee Report prior to the voting thereon. The House
shall vote on the Conference Committee Report in the same manner and
procedure as it votes on a bill on third and final reading.
Rule XII, Section 35 of the Rules of the Senate states:
Sec. 35. In the event that the Senate does not agree with the House of
Representatives on the provision of any bill or joint resolution, the
differences shall be settled by a conference committee of both Houses
which shall meet within ten (10) days after their composition. The
President shall designate the members of the Senate Panel in the
conference committee with the approval of the Senate.
Each Conference Committee Report shall contain a detailed and
sufficiently explicit statement of the changes in, or amendments to the
subject measure, and shall be signed by a majority of the members of
each House panel, voting separately.
A comparative presentation of the conflicting House and Senate
provisions and a reconciled version thereof with the explanatory
statement of the conference committee shall be attached to the report.
...
The creation of such conference committee was apparently in response
to a problem, not addressed by any constitutional provision, where the
two houses of Congress find themselves in disagreement over changes
or amendments introduced by the other house in a legislative bill. Given
that one of the most basic powers of the legislative branch is to formulate
and implement its own rules of proceedings and to discipline its
members, may the Court then delve into the details of how Congress
complies with its internal rules or how it conducts its business of passing
legislation? Note that in the present petitions, the issue is not whether
provisions of the rules of both houses creating the bicameral conference
committee are unconstitutional, but whether the bicameral conference
committee has strictly complied with the rules of both houses,
thereby remaining within the jurisdiction conferred upon it by
Congress.
In the recent case of Fariñas vs. The Executive Secretary,20 the Court En
Banc, unanimously reiterated and emphasized its adherence to the
"enrolled bill doctrine," thus, declining therein petitioners’ plea for the
Court to go behind the enrolled copy of the bill. Assailed in said case was
Congress’s creation of two sets of bicameral conference committees, the
lack of records of said committees’ proceedings, the alleged violation of
said committees of the rules of both houses, and the disappearance or
deletion of one of the provisions in the compromise bill submitted by the
bicameral conference committee. It was argued that such irregularities in
the passage of the law nullified R.A. No. 9006, or the Fair Election Act.
Striking down such argument, the Court held thus:
Under the "enrolled bill doctrine," the signing of a bill by the Speaker of
the House and the Senate President and the certification of the
Secretaries of both Houses of Congress that it was passed are
conclusive of its due enactment. A review of cases reveals the Court’s
consistent adherence to the rule. The Court finds no reason to deviate
from the salutary rule in this case where the irregularities alleged by
the petitioners mostly involved the internal rules of Congress, e.g.,
creation of the 2nd or 3rd Bicameral Conference Committee by the
House. This Court is not the proper forum for the enforcement of
these internal rules of Congress, whether House or Senate.
Parliamentary rules are merely procedural and with their
observance the courts have no concern. Whatever doubts there may
be as to the formal validity of Rep. Act No. 9006 must be resolved in
its favor. The Court reiterates its ruling in Arroyo vs. De Venecia, viz.:
But the cases, both here and abroad, in varying forms of expression,
all deny to the courts the power to inquire into allegations that, in
enacting a law, a House of Congress failed to comply with its own
rules, in the absence of showing that there was a violation of a
constitutional provision or the rights of private
individuals. In Osmeña v. Pendatun, it was held: "At any rate, courts
have declared that ‘the rules adopted by deliberative bodies are subject
to revocation, modification or waiver at the pleasure of the body adopting
them.’ And it has been said that "Parliamentary rules are merely
procedural, and with their observance, the courts have no concern.
They may be waived or disregarded by the legislative body."
Consequently, "mere failure to conform to parliamentary usage will
not invalidate the action (taken by a deliberative body) when the
requisite number of members have agreed to a particular
measure."21 (Emphasis supplied)
The foregoing declaration is exactly in point with the present cases,
where petitioners allege irregularities committed by the conference
committee in introducing changes or deleting provisions in the House and
Senate bills. Akin to the Fariñas case,22 the present petitions also raise
an issue regarding the actions taken by the conference committee on
matters regarding Congress’ compliance with its own internal rules. As
stated earlier, one of the most basic and inherent power of the legislature
is the power to formulate rules for its proceedings and the discipline of its
members. Congress is the best judge of how it should conduct its own
business expeditiously and in the most orderly manner. It is also the sole
concern of Congress to instill discipline among the members of its
conference committee if it believes that said members violated any of its
rules of proceedings. Even the expanded jurisdiction of this Court cannot
apply to questions regarding only the internal operation of Congress,
thus, the Court is wont to deny a review of the internal proceedings of a
co-equal branch of government.
Moreover, as far back as 1994 or more than ten years ago, in the case
of Tolentino vs. Secretary of Finance,23 the Court already made the
pronouncement that "[i]f a change is desired in the practice [of the
Bicameral Conference Committee] it must be sought in Congress
since this question is not covered by any constitutional provision
but is only an internal rule of each house." 24 To date, Congress has
not seen it fit to make such changes adverted to by the Court. It seems,
therefore, that Congress finds the practices of the bicameral conference
committee to be very useful for purposes of prompt and efficient
legislative action.
Nevertheless, just to put minds at ease that no blatant irregularities
tainted the proceedings of the bicameral conference committees, the
Court deems it necessary to dwell on the issue. The Court observes that
there was a necessity for a conference committee because a comparison
of the provisions of House Bill Nos. 3555 and 3705 on one hand, and
Senate Bill No. 1950 on the other, reveals that there were indeed
disagreements. As pointed out in the petitions, said disagreements were
as follows:
House Bill No. 3555 House Bill No.3705 Senate Bill No. 1950
With regard to "Stand-By Authority" in favor of President
Provides for 12% Provides for 12% VAT Provides for a single
VAT on every sale of in general on sales of rate of 10% VAT on
goods or properties goods or properties and sale of goods or
(amending Sec. 106 reduced rates for sale properties (amending
of NIRC); 12% VAT of certain locally Sec. 106 of NIRC),
on importation of manufactured goods 10% VAT on sale of
goods (amending and petroleum products services including Provides that the No similar provision Provides that the
Sec. 107 of NIRC); and raw materials to be sale of electricity by input tax credit for input tax credit for
and 12% VAT on used in the generation capital goods on capital goods on
sale of services and manufacture thereof companies, which a VAT has which a VAT has
use or lease of (amending Sec. 106 of transmission and been paid shall be been paid shall be
properties NIRC); 12% VAT on distribution equally distributed equally distributed
(amending Sec. 108 importation of goods companies, and use over 5 years or the over 5 years or the
of NIRC) and reduced rates for or lease of properties depreciable life of depreciable life of
certain imported (amending Sec. 108 such capital goods; such capital goods;
products including of NIRC) the input tax credit the input tax credit for
petroleum products for goods and goods and services
(amending Sec. 107 of services other than other than capital
NIRC); and 12% VAT capital goods shall goods shall not
on sale of services and not exceed 5% of exceed 90% of the
use or lease of the total amount of output VAT.
properties and a such goods and
reduced rate for certain services; and for
services including persons engaged in
power generation retail trading of
(amending Sec. 108 of goods, the allowable
NIRC) input tax credit shall
With regard to the "no pass-on" provision not exceed 11% of
No similar provision Provides that the VAT Provides that the the total amount of
imposed on power VAT imposed on goods purchased.
generation and on the sales of electricity by With regard to amendments to be made to NIRC provisions
sale of petroleum generation regarding income and excise taxes
products shall be companies and No similar No similar provision Provided for
absorbed by generation services of provision amendments to
companies or sellers, transmission several NIRC
respectively, and shall companies and provisions
not be passed on to distribution regarding corporate
consumers companies, as well income,
as those of franchise percentage,
grantees of electric franchise and
utilities shall not excise taxes
apply to residential
The disagreements between the provisions in the House bills and the
end-users. VAT shall Senate bill were with regard to (1) what rate of VAT is to be imposed; (2)
be absorbed by whether only the VAT imposed on electricity generation, transmission
generation, and distribution companies should not be passed on to consumers, as
transmission, and proposed in the Senate bill, or both the VAT imposed on electricity
distribution generation, transmission and distribution companies and the VAT
companies. imposed on sale of petroleum products should not be passed on to
With regard to 70% limit on input tax credit consumers, as proposed in the House bill; (3) in what manner input tax
credits should be limited; (4) and whether the NIRC provisions on
corporate income taxes, percentage, franchise and excise taxes should
be amended.
There being differences and/or disagreements on the foregoing
provisions of the House and Senate bills, the Bicameral Conference
Committee was mandated by the rules of both houses of Congress to act
on the same by settling said differences and/or disagreements. The
Bicameral Conference Committee acted on the disagreeing provisions by
making the following changes:
1. With regard to the disagreement on the rate of VAT to be imposed, it
would appear from the Conference Committee Report that the Bicameral
Conference Committee tried to bridge the gap in the difference between
the 10% VAT rate proposed by the Senate, and the various rates with
12% as the highest VAT rate proposed by the House, by striking a
compromise whereby the present 10% VAT rate would be retained until
certain conditions arise, i.e., the value-added tax collection as a
percentage of gross domestic product (GDP) of the previous year
exceeds 2 4/5%, or National Government deficit as a percentage of GDP
of the previous year exceeds 1½%, when the President, upon
recommendation of the Secretary of Finance shall raise the rate of VAT
to 12% effective January 1, 2006.
2. With regard to the disagreement on whether only the VAT imposed on
electricity generation, transmission and distribution companies should not
be passed on to consumers or whether both the VAT imposed on
electricity generation, transmission and distribution companies and the
VAT imposed on sale of petroleum products may be passed on to
consumers, the Bicameral Conference Committee chose to settle such
disagreement by altogether deleting from its Report any no pass-
on provision.
3. With regard to the disagreement on whether input tax credits should be
limited or not, the Bicameral Conference Committee decided to adopt the
position of the House by putting a limitation on the amount of input tax
that may be credited against the output tax, although it crafted its own
language as to the amount of the limitation on input tax credits and the
manner of computing the same by providing thus:
(A) Creditable Input Tax. – . . .
...
Provided, The input tax on goods purchased or imported in a calendar
month for use in trade or business for which deduction for depreciation is
allowed under this Code, shall be spread evenly over the month of
acquisition and the fifty-nine (59) succeeding months if the aggregate
acquisition cost for such goods, excluding the VAT component thereof,
exceeds one million Pesos (₱1,000,000.00): PROVIDED, however, that if
the estimated useful life of the capital good is less than five (5) years, as
used for depreciation purposes, then the input VAT shall be spread over
such shorter period: . . .
(B) Excess Output or Input Tax. – If at the end of any taxable quarter the
output tax exceeds the input tax, the excess shall be paid by the VAT-
registered person. If the input tax exceeds the output tax, the excess
shall be carried over to the succeeding quarter or quarters: PROVIDED
that the input tax inclusive of input VAT carried over from the previous
quarter that may be credited in every quarter shall not exceed seventy
percent (70%) of the output VAT: PROVIDED, HOWEVER, THAT any
input tax attributable to zero-rated sales by a VAT-registered person may
at his option be refunded or credited against other internal revenue taxes,
...
4. With regard to the amendments to other provisions of the NIRC on
corporate income tax, franchise, percentage and excise taxes, the
conference committee decided to include such amendments and
basically adopted the provisions found in Senate Bill No. 1950, with some
changes as to the rate of the tax to be imposed.
Under the provisions of both the Rules of the House of Representatives
and Senate Rules, the Bicameral Conference Committee is mandated to
settle the differences between the disagreeing provisions in the House
bill and the Senate bill. The term "settle" is synonymous to "reconcile"
and "harmonize."25 To reconcile or harmonize disagreeing provisions, the
Bicameral Conference Committee may then (a) adopt the specific
provisions of either the House bill or Senate bill, (b) decide that neither
provisions in the House bill or the provisions in the Senate bill would
be carried into the final form of the bill, and/or (c) try to arrive at a
compromise between the disagreeing provisions.
In the present case, the changes introduced by the Bicameral
Conference Committee on disagreeing provisions were meant only to
reconcile and harmonize the disagreeing provisions for it did not inject
any idea or intent that is wholly foreign to the subject embraced by the
original provisions.
The so-called stand-by authority in favor of the President, whereby the
rate of 10% VAT wanted by the Senate is retained until such time that
certain conditions arise when the 12% VAT wanted by the House shall be
imposed, appears to be a compromise to try to bridge the difference in
the rate of VAT proposed by the two houses of Congress. Nevertheless,
such compromise is still totally within the subject of what rate of VAT
should be imposed on taxpayers.
The no pass-on provision was deleted altogether. In the transcripts of the
proceedings of the Bicameral Conference Committee held on May 10,
2005, Sen. Ralph Recto, Chairman of the Senate Panel, explained the
reason for deleting the no pass-on provision in this wise:
. . . the thinking was just to keep the VAT law or the VAT bill simple. And
we were thinking that no sector should be a beneficiary of legislative
grace, neither should any sector be discriminated on. The VAT is an
indirect tax. It is a pass on-tax. And let’s keep it plain and simple. Let’s
not confuse the bill and put a no pass-on provision. Two-thirds of the
world have a VAT system and in this two-thirds of the globe, I have yet to
see a VAT with a no pass-though provision. So, the thinking of the
Senate is basically simple, let’s keep the VAT simple. 26 (Emphasis
supplied)
Rep. Teodoro Locsin further made the manifestation that the no pass-
on provision "never really enjoyed the support of either House." 27
With regard to the amount of input tax to be credited against output tax,
the Bicameral Conference Committee came to a compromise on the
percentage rate of the limitation or cap on such input tax credit, but
again, the change introduced by the Bicameral Conference Committee
was totally within the intent of both houses to put a cap on input tax that
may be
credited against the output tax. From the inception of the subject revenue
bill in the House of Representatives, one of the major objectives was to
"plug a glaring loophole in the tax policy and administration by creating
vital restrictions on the claiming of input VAT tax credits . . ." and "[b]y
introducing limitations on the claiming of tax credit, we are capping a
major leakage that has placed our collection efforts at an apparent
disadvantage."28
As to the amendments to NIRC provisions on taxes other than the value-
added tax proposed in Senate Bill No. 1950, since said provisions were
among those referred to it, the conference committee had to act on the
same and it basically adopted the version of the Senate.
Thus, all the changes or modifications made by the Bicameral
Conference Committee were germane to subjects of the provisions
referred
to it for reconciliation. Such being the case, the Court does not see any
grave abuse of discretion amounting to lack or excess of jurisdiction
committed by the Bicameral Conference Committee. In the earlier cases
of Philippine Judges Association vs. Prado29 and Tolentino vs. Secretary
of Finance,30 the Court recognized the long-standing legislative practice
of giving said conference committee ample latitude for compromising
differences between the Senate and the House. Thus, in
the Tolentino case, it was held that:
. . . it is within the power of a conference committee to include in its report
an entirely new provision that is not found either in the House bill or in the
Senate bill. If the committee can propose an amendment consisting of
one or two provisions, there is no reason why it cannot propose several
provisions, collectively considered as an "amendment in the nature of a
substitute," so long as such amendment is germane to the subject of the
bills before the committee. After all, its report was not final but needed
the approval of both houses of Congress to become valid as an act of the
legislative department. The charge that in this case the Conference
Committee acted as a third legislative chamber is thus without any
basis.31 (Emphasis supplied)
B. R.A. No. 9337 Does Not Violate Article VI, Section 26(2) of the
Constitution on the "No-Amendment Rule"
Article VI, Sec. 26 (2) of the Constitution, states:
No bill passed by either House shall become a law unless it has passed
three readings on separate days, and printed copies thereof in its final
form have been distributed to its Members three days before its passage,
except when the President certifies to the necessity of its immediate
enactment to meet a public calamity or emergency. Upon the last reading
of a bill, no amendment thereto shall be allowed, and the vote thereon
shall be taken immediately thereafter, and the yeas and nays entered in
the Journal.
Petitioners’ argument that the practice where a bicameral conference
committee is allowed to add or delete provisions in the House bill and the
Senate bill after these had passed three readings is in effect a
circumvention of the "no amendment rule" (Sec. 26 (2), Art. VI of the
1987 Constitution), fails to convince the Court to deviate from its ruling in
the Tolentino case that:
Nor is there any reason for requiring that the Committee’s Report in these
cases must have undergone three readings in each of the two houses. If
that be the case, there would be no end to negotiation since each house
may seek modification of the compromise bill. . . .
Art. VI. § 26 (2) must, therefore, be construed as referring only to
bills introduced for the first time in either house of Congress, not to
the conference committee report.32 (Emphasis supplied)
The Court reiterates here that the "no-amendment rule" refers only to
the procedure to be followed by each house of Congress with
regard to bills initiated in each of said respective houses, before
said bill is transmitted to the other house for its concurrence or
amendment. Verily, to construe said provision in a way as to proscribe
any further changes to a bill after one house has voted on it would lead to
absurdity as this would mean that the other house of Congress would be
deprived of its constitutional power to amend or introduce changes to
said bill. Thus, Art. VI, Sec. 26 (2) of the Constitution cannot be taken to
mean that the introduction by the Bicameral Conference Committee of
amendments and modifications to disagreeing provisions in bills that
have been acted upon by both houses of Congress is prohibited.
C. R.A. No. 9337 Does Not Violate Article VI, Section 24 of the
Constitution on Exclusive Origination of Revenue Bills
Coming to the issue of the validity of the amendments made regarding
the NIRC provisions on corporate income taxes and percentage, excise
taxes. Petitioners refer to the following provisions, to wit:
Section Rates of Income Tax on Domestic Corporation
27
28(A)(1) Tax on Resident Foreign Corporation
28(B)(1) Inter-corporate Dividends
34(B)(1) Inter-corporate Dividends
116 Tax on Persons Exempt from VAT
117 Percentage Tax on domestic carriers and keepers of
Garage
119 Tax on franchises
121 Tax on banks and Non-Bank Financial Intermediaries
148 Excise Tax on manufactured oils and other fuels
151 Excise Tax on mineral products
236 Registration requirements
237 Issuance of receipts or sales or commercial invoices
288 Disposition of Incremental Revenue
Petitioners claim that the amendments to these provisions of the NIRC
did not at all originate from the House. They aver that House Bill No.
3555 proposed amendments only regarding Sections 106, 107, 108, 110
and 114 of the NIRC, while House Bill No. 3705 proposed amendments
only to Sections 106, 107,108, 109, 110 and 111 of the NIRC; thus, the
other sections of the NIRC which the Senate amended but which
amendments were not found in the House bills are not intended to be
amended by the House of Representatives. Hence, they argue that since
the proposed amendments did not originate from the House, such
amendments are a violation of Article VI, Section 24 of the Constitution.
The argument does not hold water.
Article VI, Section 24 of the Constitution reads:
Sec. 24. All appropriation, revenue or tariff bills, bills authorizing increase
of the public debt, bills of local application, and private bills shall originate
exclusively in the House of Representatives but the Senate may propose
or concur with amendments.
In the present cases, petitioners admit that it was indeed House Bill Nos.
3555 and 3705 that initiated the move for amending provisions of the
NIRC dealing mainly with the value-added tax. Upon transmittal of said
House bills to the Senate, the Senate came out with Senate Bill No. 1950
proposing amendments not only to NIRC provisions on the value-added
tax but also amendments to NIRC provisions on other kinds of taxes. Is
the introduction by the Senate of provisions not dealing directly with the
value- added tax, which is the only kind of tax being amended in the
House bills, still within the purview of the constitutional provision
authorizing the Senate to propose or concur with amendments to a
revenue bill that originated from the House?
The foregoing question had been squarely answered in
the Tolentino case, wherein the Court held, thus:
. . . To begin with, it is not the law – but the revenue bill – which is
required by the Constitution to "originate exclusively" in the House of
Representatives. It is important to emphasize this, because a bill
originating in the House may undergo such extensive changes in the
Senate that the result may be a rewriting of the whole. . . . At this point,
what is important to note is that, as a result of the Senate action, a
distinct bill may be produced. To insist that a revenue statute – and
not only the bill which initiated the legislative process culminating
in the enactment of the law – must substantially be the same as the
House bill would be to deny the Senate’s power not only to "concur
with amendments" but also to "propose amendments." It would be to
violate the coequality of legislative power of the two houses of Congress
and in fact make the House superior to the Senate.
… have been identified by the administration. It is supported with a
…Given, then, the power of the Senate to propose amendments, the
Senate can propose its own version even with respect to bills which
are required by the Constitution to originate in the House.
...
Indeed, what the Constitution simply means is that the initiative for filing
revenue, tariff or tax bills, bills authorizing an increase of the public debt,
private bills and bills of local application must come from the House of
Representatives on the theory that, elected as they are from the
districts, the members of the House can be expected to be more
sensitive to the local needs and problems. On the other hand, the
senators, who are elected at large, are expected to approach the
same problems from the national perspective. Both views are
thereby made to bear on the enactment of such laws.33 (Emphasis
supplied)
Since there is no question that the revenue bill exclusively originated in
the House of Representatives, the Senate was acting within its
constitutional power to introduce amendments to the House bill when it
included provisions in Senate Bill No. 1950 amending corporate income
taxes, percentage, excise and franchise taxes. Verily, Article VI, Section
24 of the Constitution does not contain any prohibition or limitation on the
extent of the amendments that may be introduced by the Senate to the
House revenue bill.
Furthermore, the amendments introduced by the Senate to the NIRC
provisions that had not been touched in the House bills are still in
furtherance of the intent of the House in initiating the subject revenue
bills. The Explanatory Note of House Bill No. 1468, the very first House
bill introduced on the floor, which was later substituted by House Bill No.
3555, stated:
One of the challenges faced by the present administration is the urgent
and daunting task of solving the country’s serious financial problems. To
do this, government expenditures must be strictly monitored and
controlled and revenues must be significantly increased. This may be
easier said than done, but our fiscal authorities are still optimistic the
government will be operating on a balanced budget by the year 2009. In
fact, several measures that will result to significant expenditure savings
credible package of revenue measures that include measures to
improve tax administration and control the leakages in revenues
from income taxes and the value-added tax (VAT). (Emphasis
supplied)
Rep. Eric D. Singson, in his sponsorship speech for House Bill No. 3555,
declared that:
In the budget message of our President in the year 2005, she reiterated
that we all acknowledged that on top of our agenda must be the
restoration of the health of our fiscal system.
In order to considerably lower the consolidated public sector deficit and
eventually achieve a balanced budget by the year 2009, we need to
seize windows of opportunities which might seem poignant in the
beginning, but in the long run prove effective and beneficial to the
overall status of our economy. One such opportunity is a review of
existing tax rates, evaluating the relevance given our present
conditions.34 (Emphasis supplied)
Notably therefore, the main purpose of the bills emanating from the
House of Representatives is to bring in sizeable revenues for the
government
to supplement our country’s serious financial problems, and improve tax
administration and control of the leakages in revenues from income taxes
and value-added taxes. As these house bills were transmitted to the
Senate, the latter, approaching the measures from the point of national
perspective, can introduce amendments within the purposes of those
bills. It can provide for ways that would soften the impact of the VAT
measure on the consumer, i.e., by distributing the burden across all
sectors instead of putting it entirely on the shoulders of the consumers.
The sponsorship speech of Sen. Ralph Recto on why the provisions on
income tax on corporation were included is worth quoting:
All in all, the proposal of the Senate Committee on Ways and Means will
raise ₱64.3 billion in additional revenues annually even while by
mitigating prices of power, services and petroleum products.
However, not all of this will be wrung out of VAT. In fact, only ₱48.7
billion amount is from the VAT on twelve goods and services. The rest of
the tab – ₱10.5 billion- will be picked by corporations.
What we therefore prescribe is a burden sharing between corporate
Philippines and the consumer. Why should the latter bear all the pain?
Why should the fiscal salvation be only on the burden of the consumer?
The corporate world’s equity is in form of the increase in the corporate
income tax from 32 to 35 percent, but up to 2008 only. This will raise
₱10.5 billion a year. After that, the rate will slide back, not to its old rate of
32 percent, but two notches lower, to 30 percent.
Clearly, we are telling those with the capacity to pay, corporations, to
bear with this emergency provision that will be in effect for 1,200 days,
while we put our fiscal house in order. This fiscal medicine will have an
expiry date.
For their assistance, a reward of tax reduction awaits them. We intend to
keep the length of their sacrifice brief. We would like to assure them that
not because there is a light at the end of the tunnel, this government will
keep on making the tunnel long.
The responsibility will not rest solely on the weary shoulders of the small
man. Big business will be there to share the burden. 35
As the Court has said, the Senate can propose amendments and in fact,
the amendments made on provisions in the tax on income of corporations
are germane to the purpose of the house bills which is to raise revenues
for the government.
Likewise, the Court finds the sections referring to other percentage and
excise taxes germane to the reforms to the VAT system, as these
sections would cushion the effects of VAT on consumers. Considering
that certain goods and services which were subject to percentage tax and
excise tax would no longer be VAT-exempt, the consumer would be
burdened more as they would be paying the VAT in addition to these
taxes. Thus, there is a need to amend these sections to soften the impact
of VAT. Again, in his sponsorship speech, Sen. Recto said:
However, for power plants that run on oil, we will reduce to zero the
present excise tax on bunker fuel, to lessen the effect of a VAT on this
product.
For electric utilities like Meralco, we will wipe out the franchise tax in
exchange for a VAT.
And in the case of petroleum, while we will levy the VAT on oil products,
so as not to destroy the VAT chain, we will however bring down the
excise tax on socially sensitive products such as diesel, bunker, fuel and
kerosene.
...
What do all these exercises point to? These are not contortions of giving
to the left hand what was taken from the right. Rather, these sprang from
our concern of softening the impact of VAT, so that the people can
cushion the blow of higher prices they will have to pay as a result of
VAT.36
The other sections amended by the Senate pertained to matters of tax
administration which are necessary for the implementation of the
changes in the VAT system.
To reiterate, the sections introduced by the Senate are germane to the
subject matter and purposes of the house bills, which is to supplement
our country’s fiscal deficit, among others. Thus, the Senate acted within
its power to propose those amendments.
SUBSTANTIVE ISSUES
 I.
Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106,
107 and 108 of the NIRC, violate the following provisions of the
Constitution:
a. Article VI, Section 28(1), and
b. Article VI, Section 28(2)
A. No Undue Delegation of Legislative Power
Petitioners ABAKADA GURO Party List, et al., Pimentel, Jr., et al., and
Escudero, et al. contend in common that Sections 4, 5 and 6 of R.A. No.
9337, amending Sections 106, 107 and 108, respectively, of the NIRC
giving the President the stand-by authority to raise the VAT rate from
10% to 12% when a certain condition is met, constitutes undue
delegation of the legislative power to tax.
The assailed provisions read as follows:
SEC. 4. Sec. 106 of the same Code, as amended, is hereby further
amended to read as follows:
SEC. 106. Value-Added Tax on Sale of Goods or Properties. –
(A) Rate and Base of Tax. – There shall be levied, assessed and
collected on every sale, barter or exchange of goods or properties, a
value-added tax equivalent to ten percent (10%) of the gross selling price
or gross value in money of the goods or properties sold, bartered or
exchanged, such tax to be paid by the seller or transferor: provided,
that the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-
added tax to twelve percent (12%), after any of the following
conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth
percent (2 4/5%) or
(ii) national government deficit as a percentage of GDP of the
previous year exceeds one and one-half percent (1 ½%).
SEC. 5. Section 107 of the same Code, as amended, is hereby further
amended to read as follows:
SEC. 107. Value-Added Tax on Importation of Goods. –
(A) In General. – There shall be levied, assessed and collected on every
importation of goods a value-added tax equivalent to ten percent (10%)
based on the total value used by the Bureau of Customs in determining
tariff and customs duties, plus customs duties, excise taxes, if any, and
other charges, such tax to be paid by the importer prior to the release of
such goods from customs custody: Provided, That where the customs
duties are determined on the basis of the quantity or volume of the
goods, the value-added tax shall be based on the landed cost plus excise
taxes, if any: provided, further, that the President, upon the
recommendation of the Secretary of Finance, shall, effective
January 1, 2006, raise the rate of value-added tax to twelve percent
(12%) after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth
percent (2 4/5%) or
(ii) national government deficit as a percentage of GDP of the
previous year exceeds one and one-half percent (1 ½%).
SEC. 6. Section 108 of the same Code, as amended, is hereby further
amended to read as follows:
SEC. 108. Value-added Tax on Sale of Services and Use or Lease of
Properties –
(A) Rate and Base of Tax. – There shall be levied, assessed and
collected, a value-added tax equivalent to ten percent (10%) of gross
receipts derived from the sale or exchange of services: provided, that
the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-
added tax to twelve percent (12%), after any of the following
conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth
percent (2 4/5%) or
(ii) national government deficit as a percentage of GDP of the
previous year exceeds one and one-half percent (1 ½%). (Emphasis
supplied)
Petitioners allege that the grant of the stand-by authority to the President
to increase the VAT rate is a virtual abdication by Congress of its
exclusive power to tax because such delegation is not within the purview
of Section 28 (2), Article VI of the Constitution, which provides:
The Congress may, by law, authorize the President to fix within specified
limits, and may impose, tariff rates, import and export quotas, tonnage
and wharfage dues, and other duties or imposts within the framework of
the national development program of the government.
They argue that the VAT is a tax levied on the sale, barter or exchange of
goods and properties as well as on the sale or exchange of services,
which cannot be included within the purview of tariffs under the exempted
delegation as the latter refers to customs duties, tolls or tribute payable
upon merchandise to the government and usually imposed on goods or
merchandise imported or exported.
Petitioners ABAKADA GURO Party List, et al., further contend that
delegating to the President the legislative power to tax is contrary to
republicanism. They insist that accountability, responsibility and
transparency should dictate the actions of Congress and they should not
pass to the President the decision to impose taxes. They also argue that
the law also effectively nullified the President’s power of control, which
includes the authority to set aside and nullify the acts of her subordinates
like the Secretary of Finance, by mandating the fixing of the tax rate by
the President upon the recommendation of the Secretary of Finance.
Petitioners Pimentel, et al. aver that the President has ample powers to
cause, influence or create the conditions provided by the law to bring
about either or both the conditions precedent.
On the other hand, petitioners Escudero, et al. find bizarre and revolting
the situation that the imposition of the 12% rate would be subject to the
whim of the Secretary of Finance, an unelected bureaucrat, contrary to
the principle of no taxation without representation. They submit that the
Secretary of Finance is not mandated to give a favorable
recommendation and he may not even give his recommendation.
Moreover, they allege that no guiding standards are provided in the law
on what basis and as to how he will make his recommendation. They
claim, nonetheless, that any recommendation of the Secretary of Finance
can easily be brushed aside by the President since the former is a mere
alter ego of the latter, such that, ultimately, it is the President who
decides whether to impose the increased tax rate or not.
A brief discourse on the principle of non-delegation of powers is
instructive.
The principle of separation of powers ordains that each of the three great
branches of government has exclusive cognizance of and is supreme in
matters falling within its own constitutionally allocated sphere. 37 A logical
corollary to the doctrine of separation of powers is the principle of non-
delegation of powers, as expressed in the Latin maxim: potestas
delegata non delegari potest which means "what has been delegated,
cannot be delegated."38 This doctrine is based on the ethical principle that
such as delegated power constitutes not only a right but a duty to be
performed by the delegate through the instrumentality of his own
judgment and not through the intervening mind of another. 39
With respect to the Legislature, Section 1 of Article VI of the Constitution
provides that "the Legislative power shall be vested in the Congress of
the Philippines which shall consist of a Senate and a House of
Representatives." The powers which Congress is prohibited from
delegating are those which are strictly, or inherently and exclusively,
legislative. Purely legislative power, which can never be delegated, has
been described as the authority to make a complete law – complete
as to the time when it shall take effect and as to whom it shall be
applicable – and to determine the expediency of its
enactment.40 Thus, the rule is that in order that a court may be justified in
holding a statute unconstitutional as a delegation of legislative power, it
must appear that the power involved is purely legislative in nature – that
is, one appertaining exclusively to the legislative department. It is the
nature of the power, and not the liability of its use or the manner of its
exercise, which determines the validity of its delegation.
Nonetheless, the general rule barring delegation of legislative powers is
subject to the following recognized limitations or exceptions:
(1) Delegation of tariff powers to the President under Section 28 (2) of
Article VI of the Constitution;
(2) Delegation of emergency powers to the President under Section 23
(2) of Article VI of the Constitution;
(3) Delegation to the people at large;
(4) Delegation to local governments; and
(5) Delegation to administrative bodies.
In every case of permissible delegation, there must be a showing that the
delegation itself is valid. It is valid only if the law (a) is complete in itself,
setting forth therein the policy to be executed, carried out, or
implemented by the delegate;41 and (b) fixes a standard — the limits of
which are sufficiently determinate and determinable — to which the
delegate must conform in the performance of his functions. 42 A sufficient
standard is one which defines legislative policy, marks its limits, maps out
its boundaries and specifies the public agency to apply it. It indicates the
circumstances under which the legislative command is to be
effected.43 Both tests are intended to prevent a total transference of
legislative authority to the delegate, who is not allowed to step into the
shoes of the legislature and exercise a power essentially legislative. 44
In People vs. Vera,45 the Court, through eminent Justice Jose P. Laurel,
expounded on the concept and extent of delegation of power in this wise:
In testing whether a statute constitutes an undue delegation of legislative
power or not, it is usual to inquire whether the statute was complete in all
its terms and provisions when it left the hands of the legislature so that
nothing was left to the judgment of any other appointee or delegate of the
legislature.
...
‘The true distinction’, says Judge Ranney, ‘is between the
delegation of power to make the law, which necessarily involves a
discretion as to what it shall be, and conferring an authority or
discretion as to its execution, to be exercised under and in
pursuance of the law. The first cannot be done; to the latter no valid
objection can be made.’
...
It is contended, however, that a legislative act may be made to the effect
as law after it leaves the hands of the legislature. It is true that laws may
be made effective on certain contingencies, as by proclamation of the
executive or the adoption by the people of a particular community. In
Wayman vs. Southard, the Supreme Court of the United States ruled that
the legislature may delegate a power not legislative which it may itself
rightfully exercise. The power to ascertain facts is such a power
which may be delegated. There is nothing essentially legislative in
ascertaining the existence of facts or conditions as the basis of the
taking into effect of a law. That is a mental process common to all
branches of the government. Notwithstanding the apparent tendency,
however, to relax the rule prohibiting delegation of legislative authority on
account of the complexity arising from social and economic forces at
work in this modern industrial age, the orthodox pronouncement of Judge
Cooley in his work on Constitutional Limitations finds restatement in Prof.
Willoughby's treatise on the Constitution of the United States in the
following language — speaking of declaration of legislative power to
administrative agencies: The principle which permits the legislature to
provide that the administrative agent may determine when the
circumstances are such as require the application of a law is
defended upon the ground that at the time this authority is granted,
the rule of public policy, which is the essence of the legislative act,
is determined by the legislature. In other words, the legislature, as it
is its duty to do, determines that, under given circumstances,
certain executive or administrative action is to be taken, and that,
under other circumstances, different or no action at all is to be
taken. What is thus left to the administrative official is not the
legislative determination of what public policy demands, but simply
the ascertainment of what the facts of the case require to be done
according to the terms of the law by which he is governed. The
efficiency of an Act as a declaration of legislative will must, of
course, come from Congress, but the ascertainment of the
contingency upon which the Act shall take effect may be left to such
agencies as it may designate. The legislature, then, may provide
that a law shall take effect upon the happening of future specified
contingencies leaving to some other person or body the power to
determine when the specified contingency has arisen. (Emphasis
supplied).46
In Edu vs. Ericta,47 the Court reiterated:
What cannot be delegated is the authority under the Constitution to make
laws and to alter and repeal them; the test is the completeness of the
statute in all its terms and provisions when it leaves the hands of the
legislature. To determine whether or not there is an undue delegation of
legislative power, the inquiry must be directed to the scope and
definiteness of the measure enacted. The legislative does not abdicate
its functions when it describes what job must be done, who is to do
it, and what is the scope of his authority. For a complex economy, that
may be the only way in which the legislative process can go forward. A
distinction has rightfully been made between delegation of power to
make the laws which necessarily involves a discretion as to what it
shall be, which constitutionally may not be done, and delegation of
authority or discretion as to its execution to be exercised under and
in pursuance of the law, to which no valid objection can be
made. The Constitution is thus not to be regarded as denying the
legislature the necessary resources of flexibility and practicability.
(Emphasis supplied).48
Clearly, the legislature may delegate to executive officers or bodies the
power to determine certain facts or conditions, or the happening of
contingencies, on which the operation of a statute is, by its terms, made
to depend, but the legislature must prescribe sufficient standards, policies
or limitations on their authority.49 While the power to tax cannot be
delegated to executive agencies, details as to the enforcement and
administration of an exercise of such power may be left to them, including
the power to determine the existence of facts on which its operation
depends.50
The rationale for this is that the preliminary ascertainment of facts as
basis for the enactment of legislation is not of itself a legislative function,
but is simply ancillary to legislation. Thus, the duty of correlating
information and making recommendations is the kind of subsidiary
activity which the legislature may perform through its members, or which
it may delegate to others to perform. Intelligent legislation on the
complicated problems of modern society is impossible in the absence of
accurate information on the part of the legislators, and any reasonable
method of securing such information is proper. 51 The Constitution as a
continuously operative charter of government does not require that
Congress find for itself
every fact upon which it desires to base legislative action or that it make
for itself detailed determinations which it has declared to be prerequisite
to application of legislative policy to particular facts and circumstances
impossible for Congress itself properly to investigate.52
In the present case, the challenged section of R.A. No. 9337 is the
common proviso in Sections 4, 5 and 6 which reads as follows:
That the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-added
tax to twelve percent (12%), after any of the following conditions has
been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth percent (2
4/5%); or
(ii) National government deficit as a percentage of GDP of the previous
year exceeds one and one-half percent (1 ½%).
The case before the Court is not a delegation of legislative power. It is
simply a delegation of ascertainment of facts upon which enforcement
and administration of the increase rate under the law is contingent. The
legislature has made the operation of the 12% rate effective January 1,
2006, contingent upon a specified fact or condition. It leaves the entire
operation or non-operation of the 12% rate upon factual matters outside
of the control of the executive.
No discretion would be exercised by the President. Highlighting the
absence of discretion is the fact that the word shall is used in the
common proviso. The use of the word shall connotes a mandatory order.
Its use in a statute denotes an imperative obligation and is inconsistent
with the idea of discretion.53 Where the law is clear and unambiguous, it
must be taken to mean exactly what it says, and courts have no choice
but to see to it that the mandate is obeyed. 54
Thus, it is the ministerial duty of the President to immediately impose the
12% rate upon the existence of any of the conditions specified by
Congress. This is a duty which cannot be evaded by the President.
Inasmuch as the law specifically uses the word shall, the exercise of
discretion by the President does not come into play. It is a clear directive
to impose the 12% VAT rate when the specified conditions are present.
The time of taking into effect of the 12% VAT rate is based on the
happening of a certain specified contingency, or upon the ascertainment
of certain facts or conditions by a person or body other than the
legislature itself.
The Court finds no merit to the contention of petitioners ABAKADA
GURO Party List, et al. that the law effectively nullified the President’s
power of control over the Secretary of Finance by mandating the fixing of
the tax rate by the President upon the recommendation of the Secretary
of Finance. The Court cannot also subscribe to the position of petitioners
Pimentel, et al. that the word shall should be interpreted to mean may in
view of the phrase "upon the recommendation of the Secretary of
Finance." Neither does the Court find persuasive the submission of
petitioners Escudero, et al. that any recommendation by the Secretary of
Finance can easily be brushed aside by the President since the former is
a mere alter ego of the latter.
When one speaks of the Secretary of Finance as the alter ego of the
President, it simply means that as head of the Department of Finance he
is the assistant and agent of the Chief Executive. The multifarious
executive and administrative functions of the Chief Executive are
performed by and through the executive departments, and the acts of the
secretaries of such departments, such as the Department of Finance,
performed and promulgated in the regular course of business, are, unless
disapproved or reprobated by the Chief Executive, presumptively the acts
of the Chief Executive. The Secretary of Finance, as such, occupies a
political position and holds office in an advisory capacity, and, in the
language of Thomas Jefferson, "should be of the President's bosom
confidence" and, in the language of Attorney-General Cushing, is "subject
to the direction of the President."55
In the present case, in making his recommendation to the President on
the existence of either of the two conditions, the Secretary of Finance is
not acting as the alter ego of the President or even her subordinate. In
such instance, he is not subject to the power of control and direction of
the President. He is acting as the agent of the legislative department, to
determine and declare the event upon which its expressed will is to take
effect.56 The Secretary of Finance becomes the means or tool by which
legislative policy is determined and implemented, considering that he
possesses all the facilities to gather data and information and has a much
broader perspective to properly evaluate them. His function is to gather
and collate statistical data and other pertinent information and verify if
any of the two conditions laid out by Congress is present. His personality
in such instance is in reality but a projection of that of Congress. Thus,
being the agent of Congress and not of the President, the President
cannot alter or modify or nullify, or set aside the findings of the Secretary
of Finance and to substitute the judgment of the former for that of the
latter.
Congress simply granted the Secretary of Finance the authority to
ascertain the existence of a fact, namely, whether by December 31,
2005, the value-added tax collection as a percentage of Gross Domestic
Product (GDP) of the previous year exceeds two and four-fifth percent
(24/5%) or the national government deficit as a percentage of GDP of the
previous year exceeds one and one-half percent (1½%). If either of these
two instances has occurred, the Secretary of Finance, by legislative
mandate, must submit such information to the President. Then the 12%
VAT rate must be imposed by the President effective January 1,
2006. There is no undue delegation of legislative power but only of
the discretion as to the execution of a law. This is constitutionally
permissible.57 Congress does not abdicate its functions or unduly
delegate power when it describes what job must be done, who must do it,
and what is the scope of his authority; in our complex economy that is
frequently the only way in which the legislative process can go forward.58
As to the argument of petitioners ABAKADA GURO Party List, et al. that
delegating to the President the legislative power to tax is contrary to the
principle of republicanism, the same deserves scant consideration.
Congress did not delegate the power to tax but the mere implementation
of the law. The intent and will to increase the VAT rate to 12% came from
Congress and the task of the President is to simply execute the
legislative policy. That Congress chose to do so in such a manner is not
within the province of the Court to inquire into, its task being to interpret
the law.59
The insinuation by petitioners Pimentel, et al. that the President has
ample powers to cause, influence or create the conditions to bring about
either or both the conditions precedent does not deserve any merit as
this argument is highly speculative. The Court does not rule on
allegations which are manifestly conjectural, as these may not exist at all.
The Court deals with facts, not fancies; on realities, not appearances.
When the Court acts on appearances instead of realities, justice and law
will be short-lived.
B. The 12% Increase VAT Rate Does Not Impose an Unfair and
Unnecessary Additional Tax Burden
Petitioners Pimentel, et al. argue that the 12% increase in the VAT rate
imposes an unfair and additional tax burden on the people. Petitioners
also argue that the 12% increase, dependent on any of the 2 conditions
set forth in the contested provisions, is ambiguous because it does not
state if the VAT rate would be returned to the original 10% if the rates are
no longer satisfied. Petitioners also argue that such rate is unfair and
unreasonable, as the people are unsure of the applicable VAT rate from
year to year.
Under the common provisos of Sections 4, 5 and 6 of R.A. No. 9337, if
any of the two conditions set forth therein are satisfied, the President
shall increase the VAT rate to 12%. The provisions of the law are clear. It
does not provide for a return to the 10% rate nor does it empower the
President to so revert if, after the rate is increased to 12%, the VAT
collection goes below the 24/5 of the GDP of the previous year or that the
national government deficit as a percentage of GDP of the previous year
does not exceed 1½%.
Therefore, no statutory construction or interpretation is needed. Neither
can conditions or limitations be introduced where none is provided for.
Rewriting the law is a forbidden ground that only Congress may tread
upon.60
Thus, in the absence of any provision providing for a return to the 10%
rate, which in this case the Court finds none, petitioners’ argument is, at
best, purely speculative. There is no basis for petitioners’ fear of a
fluctuating VAT rate because the law itself does not provide that the rate
should go back to 10% if the conditions provided in Sections 4, 5 and 6
are no longer present. The rule is that where the provision of the law is
clear and unambiguous, so that there is no occasion for the court's
seeking the legislative intent, the law must be taken as it is, devoid of
judicial addition or subtraction.61
Petitioners also contend that the increase in the VAT rate, which was
allegedly an incentive to the President to raise the VAT collection to at
least 2 4/5 of the GDP of the previous year, should be based on fiscal
adequacy.
Petitioners obviously overlooked that increase in VAT collection is not
the only condition. There is another condition, i.e., the national
government deficit as a percentage of GDP of the previous year exceeds
one and one-half percent (1 ½%).
Respondents explained the philosophy behind these alternative
conditions:
1. VAT/GDP Ratio > 2.8%
The condition set for increasing VAT rate to 12% have economic or fiscal
meaning. If VAT/GDP is less than 2.8%, it means that government has
weak or no capability of implementing the VAT or that VAT is not effective
in the function of the tax collection. Therefore, there is no value to
increase it to 12% because such action will also be ineffectual.
2. Nat’l Gov’t Deficit/GDP >1.5%
The condition set for increasing VAT when deficit/GDP is 1.5% or less
means the fiscal condition of government has reached a relatively sound
position or is towards the direction of a balanced budget position.
Therefore, there is no need to increase the VAT rate since the fiscal
house is in a relatively healthy position. Otherwise stated, if the ratio is
more than 1.5%, there is indeed a need to increase the VAT rate.62
That the first condition amounts to an incentive to the President to
increase the VAT collection does not render it unconstitutional so long as
there is a public purpose for which the law was passed, which in this
case, is mainly to raise revenue. In fact, fiscal adequacy dictated the
need for a raise in revenue.
The principle of fiscal adequacy as a characteristic of a sound tax system
was originally stated by Adam Smith in his Canons of Taxation (1776),
as:
IV. Every tax ought to be so contrived as both to take out and to keep out
of the pockets of the people as little as possible over and above what it
brings into the public treasury of the state.63
It simply means that sources of revenues must be adequate to meet
government expenditures and their variations. 64
The dire need for revenue cannot be ignored. Our country is in a
quagmire of financial woe. During the Bicameral Conference Committee
hearing, then Finance Secretary Purisima bluntly depicted the country’s
gloomy state of economic affairs, thus:
First, let me explain the position that the Philippines finds itself in right
now. We are in a position where 90 percent of our revenue is used for
debt service. So, for every peso of revenue that we currently raise, 90
goes to debt service. That’s interest plus amortization of our debt. So
clearly, this is not a sustainable situation. That’s the first fact.
The second fact is that our debt to GDP level is way out of line compared
to other peer countries that borrow money from that international financial
markets. Our debt to GDP is approximately equal to our GDP. Again, that
shows you that this is not a sustainable situation.
The third thing that I’d like to point out is the environment that we are
presently operating in is not as benign as what it used to be the past five
years.
What do I mean by that?
In the past five years, we’ve been lucky because we were operating in a
period of basically global growth and low interest rates. The past few
months, we have seen an inching up, in fact, a rapid increase in the
interest rates in the leading economies of the world. And, therefore, our
ability to borrow at reasonable prices is going to be challenged. In fact,
ultimately, the question is our ability to access the financial markets.
When the President made her speech in July last year, the environment
was not as bad as it is now, at least based on the forecast of most
financial institutions. So, we were assuming that raising 80 billion would
put us in a position where we can then convince them to improve our
ability to borrow at lower rates. But conditions have changed on us
because the interest rates have gone up. In fact, just within this room, we
tried to access the market for a billion dollars because for this year alone,
the Philippines will have to borrow 4 billion dollars. Of that amount, we
have borrowed 1.5 billion. We issued last January a 25-year bond at 9.7
percent cost. We were trying to access last week and the market was not
as favorable and up to now we have not accessed and we might pull
back because the conditions are not very good.
So given this situation, we at the Department of Finance believe that we
really need to front-end our deficit reduction. Because it is deficit that is
causing the increase of the debt and we are in what we call a debt spiral.
The more debt you have, the more deficit you have because interest and
debt service eats and eats more of your revenue. We need to get out of
this debt spiral. And the only way, I think, we can get out of this debt
spiral is really have a front-end adjustment in our revenue base.65
The image portrayed is chilling. Congress passed the law hoping for
rescue from an inevitable catastrophe. Whether the law is indeed
sufficient to answer the state’s economic dilemma is not for the Court to
judge. In the Fariñas case, the Court refused to consider the various
arguments raised therein that dwelt on the wisdom of Section 14 of R.A.
No. 9006 (The Fair Election Act), pronouncing that:
. . . policy matters are not the concern of the Court. Government policy is
within the exclusive dominion of the political branches of the government.
It is not for this Court to look into the wisdom or propriety of legislative
determination. Indeed, whether an enactment is wise or unwise, whether
it is based on sound economic theory, whether it is the best means to
achieve the desired results, whether, in short, the legislative discretion
within its prescribed limits should be exercised in a particular manner are
matters for the judgment of the legislature, and the serious conflict of
opinions does not suffice to bring them within the range of judicial
cognizance.66
In the same vein, the Court in this case will not dawdle on the purpose of
Congress or the executive policy, given that it is not for the judiciary to
"pass upon questions of wisdom, justice or expediency of legislation." 67
II.
Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and
110(B) of the NIRC; and Section 12 of R.A. No. 9337, amending Section
114(C) of the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and
b. Article III, Section 1
A. Due Process and Equal Protection Clauses
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. argue that
Section 8 of R.A. No. 9337, amending Sections 110 (A)(2), 110 (B), and
Section 12 of R.A. No. 9337, amending Section 114 (C) of the NIRC are
arbitrary, oppressive, excessive and confiscatory. Their argument is
premised on the constitutional right against deprivation of life, liberty of
property without due process of law, as embodied in Article III, Section 1
of the Constitution.
Petitioners also contend that these provisions violate the constitutional
guarantee of equal protection of the law.
The doctrine is that where the due process and equal protection clauses
are invoked, considering that they are not fixed rules but rather broad
standards, there is a need for proof of such persuasive character as
would lead to such a conclusion. Absent such a showing, the
presumption of validity must prevail.68
Section 8 of R.A. No. 9337, amending Section 110(B) of the NIRC
imposes a limitation on the amount of input tax that may be credited
against the output tax. It states, in part: "[P]rovided, that the input tax
inclusive of the input VAT carried over from the previous quarter that may
be credited in every quarter shall not exceed seventy percent (70%) of
the output VAT: …"
Input Tax is defined under Section 110(A) of the NIRC, as amended, as
the value-added tax due from or paid by a VAT-registered person on the
importation of goods or local purchase of good and services, including
lease or use of property, in the course of trade or business, from a VAT-
registered person, and Output Tax is the value-added tax due on the sale
or lease of taxable goods or properties or services by any person
registered or required to register under the law.
Petitioners claim that the contested sections impose limitations on the
amount of input tax that may be claimed. In effect, a portion of the input
tax that has already been paid cannot now be credited against the output
tax.
Petitioners’ argument is not absolute. It assumes that the input tax
exceeds 70% of the output tax, and therefore, the input tax in excess of
70% remains uncredited. However, to the extent that the input tax is less
than 70% of the output tax, then 100% of such input tax is still creditable.
More importantly, the excess input tax, if any, is retained in a business’s
books of accounts and remains creditable in the succeeding quarter/s.
This is explicitly allowed by Section 110(B), which provides that "if the
input tax exceeds the output tax, the excess shall be carried over to the
succeeding quarter or quarters." In addition, Section 112(B) allows a
VAT-registered person to apply for the issuance of a tax credit certificate
or refund for any unused input taxes, to the extent that such input taxes
have not been applied against the output taxes. Such unused input tax
may be used in payment of his other internal revenue taxes.
The non-application of the unutilized input tax in a given quarter is not ad
infinitum, as petitioners exaggeratedly contend. Their analysis of the
effect of the 70% limitation is incomplete and one-sided. It ends at the net
effect that there will be unapplied/unutilized inputs VAT for a given
quarter. It does not proceed further to the fact that such
unapplied/unutilized input tax may be credited in the subsequent periods
as allowed by the carry-over provision of Section 110(B) or that it may
later on be refunded through a tax credit certificate under Section 112(B).
Therefore, petitioners’ argument must be rejected.
On the other hand, it appears that petitioner Garcia failed to comprehend
the operation of the 70% limitation on the input tax. According to
petitioner, the limitation on the creditable input tax in effect allows VAT-
registered establishments to retain a portion of the taxes they collect,
which violates the principle that tax collection and revenue should be for
public purposes and expenditures
As earlier stated, the input tax is the tax paid by a person, passed on to
him by the seller, when he buys goods. Output tax meanwhile is the tax
due to the person when he sells goods. In computing the VAT payable,
three possible scenarios may arise:
First, if at the end of a taxable quarter the output taxes charged by the
seller are equal to the input taxes that he paid and passed on by the
suppliers, then no payment is required;
Second, when the output taxes exceed the input taxes, the person shall
be liable for the excess, which has to be paid to the Bureau of Internal
Revenue (BIR);69 and
Third, if the input taxes exceed the output taxes, the excess shall be
carried over to the succeeding quarter or quarters. Should the input taxes
result from zero-rated or effectively zero-rated transactions, any excess
over the output taxes shall instead be refunded to the taxpayer or
credited against other internal revenue taxes, at the taxpayer’s option. 70
Section 8 of R.A. No. 9337 however, imposed a 70% limitation on the
input tax. Thus, a person can credit his input tax only up to the extent of
70% of the output tax. In layman’s term, the value-added taxes that a
person/taxpayer paid and passed on to him by a seller can only be
credited up to 70% of the value-added taxes that is due to him on a
taxable transaction. There is no retention of any tax collection because
the person/taxpayer has already previously paid the input tax to a seller,
and the seller will subsequently remit such input tax to the BIR. The party
directly liable for the payment of the tax is the seller. 71 What only needs to
be done is for the person/taxpayer to apply or credit these input taxes, as
evidenced by receipts, against his output taxes.
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. also argue
that the input tax partakes the nature of a property that may not be
confiscated, appropriated, or limited without due process of law.
The input tax is not a property or a property right within the constitutional
purview of the due process clause. A VAT-registered person’s
entitlement to the creditable input tax is a mere statutory privilege.
The distinction between statutory privileges and vested rights must be
borne in mind for persons have no vested rights in statutory privileges.
The state may change or take away rights, which were created by the law
of the state, although it may not take away property, which was vested by
virtue of such rights.72
Under the previous system of single-stage taxation, taxes paid at every
level of distribution are not recoverable from the taxes payable, although
it becomes part of the cost, which is deductible from the gross revenue.
When Pres. Aquino issued E.O. No. 273 imposing a 10% multi-stage tax
on all sales, it was then that the crediting of the input tax paid on
purchase or importation of goods and services by VAT-registered
persons against the output tax was introduced. 73 This was adopted by the
Expanded VAT Law (R.A. No. 7716),74 and The Tax Reform Act of 1997
(R.A. No. 8424).75 The right to credit input tax as against the output tax is
clearly a privilege created by law, a privilege that also the law can
remove, or in this case, limit.
Petitioners also contest as arbitrary, oppressive, excessive and
confiscatory, Section 8 of R.A. No. 9337, amending Section 110(A) of the
NIRC, which provides:
SEC. 110. Tax Credits. –
(A) Creditable Input Tax. – …
Provided, That the input tax on goods purchased or imported in a
calendar month for use in trade or business for which deduction for
depreciation is allowed under this Code, shall be spread evenly over the
month of acquisition and the fifty-nine (59) succeeding months if the
aggregate acquisition cost for such goods, excluding the VAT component
thereof, exceeds One million pesos (₱1,000,000.00): Provided, however,
That if the estimated useful life of the capital goods is less than five (5)
years, as used for depreciation purposes, then the input VAT shall be
spread over such a shorter period: Provided, finally, That in the case of
purchase of services, lease or use of properties, the input tax shall be
creditable to the purchaser, lessee or license upon payment of the
compensation, rental, royalty or fee.
The foregoing section imposes a 60-month period within which to
amortize the creditable input tax on purchase or importation of capital
goods with acquisition cost of ₱1 Million pesos, exclusive of the VAT
component. Such spread out only poses a delay in the crediting of the
input tax. Petitioners’ argument is without basis because the taxpayer is
not permanently deprived of his privilege to credit the input tax.
It is worth mentioning that Congress admitted that the spread-out of the
creditable input tax in this case amounts to a 4-year interest-free loan to
the government.76 In the same breath, Congress also justified its move by
saying that the provision was designed to raise an annual revenue of
22.6 billion.77 The legislature also dispelled the fear that the provision will
fend off foreign investments, saying that foreign investors have other tax
incentives provided by law, and citing the case of China, where despite a
17.5% non-creditable VAT, foreign investments were not
deterred.78 Again, for whatever is the purpose of the 60-month
amortization, this involves executive economic policy and legislative
wisdom in which the Court cannot intervene.
With regard to the 5% creditable withholding tax imposed on payments
made by the government for taxable transactions, Section 12 of R.A. No.
9337, which amended Section 114 of the NIRC, reads:
SEC. 114. Return and Payment of Value-added Tax. –
(C) Withholding of Value-added Tax. – The Government or any of its
political subdivisions, instrumentalities or agencies, including
government-owned or controlled corporations (GOCCs) shall, before
making payment on account of each purchase of goods and services
which are subject to the value-added tax imposed in Sections 106 and
108 of this Code, deduct and withhold a final value-added tax at the rate
of five percent (5%) of the gross payment thereof: Provided, That the
payment for lease or use of properties or property rights to nonresident
owners shall be subject to ten percent (10%) withholding tax at the time
of payment. For purposes of this Section, the payor or person in control
of the payment shall be considered as the withholding agent.
The value-added tax withheld under this Section shall be remitted within
ten (10) days following the end of the month the withholding was made.
Section 114(C) merely provides a method of collection, or as stated by
respondents, a more simplified VAT withholding system. The government
in this case is constituted as a withholding agent with respect to their
payments for goods and services.
Prior to its amendment, Section 114(C) provided for different rates of
value-added taxes to be withheld -- 3% on gross payments for purchases
of goods; 6% on gross payments for services supplied by contractors
other than by public works contractors; 8.5% on gross payments for
services supplied by public work contractors; or 10% on payment for the
lease or use of properties or property rights to nonresident owners. Under
the present Section 114(C), these different rates, except for the 10% on
lease or property rights payment to nonresidents, were deleted, and a
uniform rate of 5% is applied.
The Court observes, however, that the law the used the word final. In tax
usage, final, as opposed to creditable, means full. Thus, it is provided in
Section 114(C): "final value-added tax at the rate of five percent (5%)."
In Revenue Regulations No. 02-98, implementing R.A. No. 8424 (The
Tax Reform Act of 1997), the concept of final withholding tax on income
was explained, to wit:
SECTION 2.57. Withholding of Tax at Source
(A) Final Withholding Tax. – Under the final withholding tax system the
amount of income tax withheld by the withholding agent is constituted
as full and final payment of the income tax due from the payee on the
said income. The liability for payment of the tax rests primarily on the
payor as a withholding agent. Thus, in case of his failure to withhold the
tax or in case of underwithholding, the deficiency tax shall be collected
from the payor/withholding agent. …
(B) Creditable Withholding Tax. – Under the creditable withholding tax
system, taxes withheld on certain income payments are intended to equal
or at least approximate the tax due of the payee on said income. …
Taxes withheld on income payments covered by the expanded
withholding tax (referred to in Sec. 2.57.2 of these regulations) and
compensation income (referred to in Sec. 2.78 also of these regulations)
are creditable in nature.
As applied to value-added tax, this means that taxable transactions with
the government are subject to a 5% rate, which constitutes as full
payment of the tax payable on the transaction. This represents the net
VAT payable of the seller. The other 5% effectively accounts for the
standard input VAT (deemed input VAT), in lieu of the actual input VAT
directly or attributable to the taxable transaction. 79
The Court need not explore the rationale behind the provision. It is clear
that Congress intended to treat differently taxable transactions with the
government.80 This is supported by the fact that under the old provision,
the 5% tax withheld by the government remains creditable against the tax
liability of the seller or contractor, to wit:
SEC. 114. Return and Payment of Value-added Tax. –
(C) Withholding of Creditable Value-added Tax. – The Government or
any of its political subdivisions, instrumentalities or agencies, including
government-owned or controlled corporations (GOCCs) shall, before
making payment on account of each purchase of goods from sellers and
services rendered by contractors which are subject to the value-added
tax imposed in Sections 106 and 108 of this Code, deduct and withhold
the value-added tax due at the rate of three percent (3%) of the gross
payment for the purchase of goods and six percent (6%) on gross
receipts for services rendered by contractors on every sale or installment
payment which shall be creditable against the value-added tax liability
of the seller or contractor: Provided, however, That in the case of
government public works contractors, the withholding rate shall be eight
and one-half percent (8.5%): Provided, further, That the payment for
lease or use of properties or property rights to nonresident owners shall
be subject to ten percent (10%) withholding tax at the time of payment.
For this purpose, the payor or person in control of the payment shall be
considered as the withholding agent.
The valued-added tax withheld under this Section shall be remitted within
ten (10) days following the end of the month the withholding was made.
(Emphasis supplied)
As amended, the use of the word final and the deletion of the
word creditable exhibits Congress’s intention to treat transactions with
the government differently. Since it has not been shown that the class
subject to the 5% final withholding tax has been unreasonably narrowed,
there is no reason to invalidate the provision. Petitioners, as petroleum
dealers, are not the only ones subjected to the 5% final withholding tax. It
applies to all those who deal with the government.
Moreover, the actual input tax is not totally lost or uncreditable, as
petitioners believe. Revenue Regulations No. 14-2005 or the
Consolidated Value-Added Tax Regulations 2005 issued by the BIR,
provides that should the actual input tax exceed 5% of gross payments,
the excess may form part of the cost. Equally, should the actual input tax
be less than 5%, the difference is treated as income. 81
Petitioners also argue that by imposing a limitation on the creditable input
tax, the government gets to tax a profit or value-added even if there is no
profit or value-added.
Petitioners’ stance is purely hypothetical, argumentative, and again, one-
sided. The Court will not engage in a legal joust where premises are what
ifs, arguments, theoretical and facts, uncertain. Any disquisition by the
Court on this point will only be, as Shakespeare describes life
in Macbeth,82 "full of sound and fury, signifying nothing."
What’s more, petitioners’ contention assumes the proposition that there is
no profit or value-added. It need not take an astute businessman to know
that it is a matter of exception that a business will sell goods or services
without profit or value-added. It cannot be overstressed that a business is
created precisely for profit.
The equal protection clause under the Constitution means that "no
person or class of persons shall be deprived of the same protection of
laws which is enjoyed by other persons or other classes in the same
place and in like circumstances."83
The power of the State to make reasonable and natural classifications for
the purposes of taxation has long been established. Whether it relates to
the subject of taxation, the kind of property, the rates to be levied, or the
amounts to be raised, the methods of assessment, valuation and
collection, the State’s power is entitled to presumption of validity. As a
rule, the judiciary will not interfere with such power absent a clear
showing of unreasonableness, discrimination, or arbitrariness. 84
Petitioners point out that the limitation on the creditable input tax if the
entity has a high ratio of input tax, or invests in capital equipment, or has
several transactions with the government, is not based on real and
substantial differences to meet a valid classification.
The argument is pedantic, if not outright baseless. The law does not
make any classification in the subject of taxation, the kind of property, the
rates to be levied or the amounts to be raised, the methods of
assessment, valuation and collection. Petitioners’ alleged distinctions are
based on variables that bear different consequences. While the
implementation of the law may yield varying end results depending on
one’s profit margin and value-added, the Court cannot go beyond what
the legislature has laid down and interfere with the affairs of business.
The equal protection clause does not require the universal application of
the laws on all persons or things without distinction. This might in fact
sometimes result in unequal protection. What the clause requires is
equality among equals as determined according to a valid classification.
By classification is meant the grouping of persons or things similar to
each other in certain particulars and different from all others in these
same particulars.85
Petitioners brought to the Court’s attention the introduction of Senate Bill
No. 2038 by Sens. S.R. Osmeña III and Ma. Ana Consuelo A.S. –
Madrigal on June 6, 2005, and House Bill No. 4493 by Rep. Eric D.
Singson. The proposed legislation seeks to amend the 70% limitation by
increasing the same to 90%. This, according to petitioners, supports their
stance that the 70% limitation is arbitrary and confiscatory. On this score,
suffice it to say that these are still proposed legislations. Until Congress
amends the law, and absent any unequivocal basis for its
unconstitutionality, the 70% limitation stays.
B. Uniformity and Equitability of Taxation
Article VI, Section 28(1) of the Constitution reads:
The rule of taxation shall be uniform and equitable. The Congress shall
evolve a progressive system of taxation.
Uniformity in taxation means that all taxable articles or kinds of property
of the same class shall be taxed at the same rate. Different articles may
be taxed at different amounts provided that the rate is uniform on the
same class everywhere with all people at all times.86
In this case, the tax law is uniform as it provides a standard rate of 0% or
10% (or 12%) on all goods and services. Sections 4, 5 and 6 of R.A. No.
9337, amending Sections 106, 107 and 108, respectively, of the NIRC,
provide for a rate of 10% (or 12%) on sale of goods and properties,
importation of goods, and sale of services and use or lease of properties.
These same sections also provide for a 0% rate on certain sales and
transaction.
Neither does the law make any distinction as to the type of industry or
trade that will bear the 70% limitation on the creditable input tax, 5-year
amortization of input tax paid on purchase of capital goods or the 5% final
withholding tax by the government. It must be stressed that the rule of
uniform taxation does not deprive Congress of the power to classify
subjects of taxation, and only demands uniformity within the particular
class.87
R.A. No. 9337 is also equitable. The law is equipped with a threshold
margin. The VAT rate of 0% or 10% (or 12%) does not apply to sales of
goods or services with gross annual sales or receipts not exceeding
₱1,500,000.00.88 Also, basic marine and agricultural food products in
their original state are still not subject to the tax, 89 thus ensuring that
prices at the grassroots level will remain accessible. As was stated
in Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. vs.
Tan:90
The disputed sales tax is also equitable. It is imposed only on sales of
goods or services by persons engaged in business with an aggregate
gross annual sales exceeding ₱200,000.00. Small corner sari-sari stores
are consequently exempt from its application. Likewise exempt from the
tax are sales of farm and marine products, so that the costs of basic food
and other necessities, spared as they are from the incidence of the VAT,
are expected to be relatively lower and within the reach of the general
public.
It is admitted that R.A. No. 9337 puts a premium on businesses with low
profit margins, and unduly favors those with high profit margins.
Congress was not oblivious to this. Thus, to equalize the weighty burden
the law entails, the law, under Section 116, imposed a 3% percentage tax
on VAT-exempt persons under Section 109(v), i.e., transactions with
gross annual sales and/or receipts not exceeding ₱1.5 Million. This acts
as a equalizer because in effect, bigger businesses that qualify for VAT
coverage and VAT-exempt taxpayers stand on equal-footing.
Moreover, Congress provided mitigating measures to cushion the impact
of the imposition of the tax on those previously exempt. Excise taxes on
petroleum products91 and natural gas92 were reduced. Percentage tax on
domestic carriers was removed.93 Power producers are now exempt from
paying franchise tax.94
Aside from these, Congress also increased the income tax rates of
corporations, in order to distribute the burden of taxation. Domestic,
foreign, and non-resident corporations are now subject to a 35% income
tax rate, from a previous 32%.95 Intercorporate dividends of non-resident
foreign corporations are still subject to 15% final withholding tax but the
tax credit allowed on the corporation’s domicile was increased to
20%.96 The Philippine Amusement and Gaming Corporation (PAGCOR)
is not exempt from income taxes anymore.97 Even the sale by an artist of
his works or services performed for the production of such works was not
spared.
All these were designed to ease, as well as spread out, the burden of
taxation, which would otherwise rest largely on the consumers. It cannot
therefore be gainsaid that R.A. No. 9337 is equitable.
C. Progressivity of Taxation
Lastly, petitioners contend that the limitation on the creditable input tax is
anything but regressive. It is the smaller business with higher input tax-
output tax ratio that will suffer the consequences.
Progressive taxation is built on the principle of the taxpayer’s ability to
pay. This principle was also lifted from Adam Smith’s Canons of Taxation,
and it states:
I. The subjects of every state ought to contribute towards the support of
the government, as nearly as possible, in proportion to their respective
abilities; that is, in proportion to the revenue which they respectively
enjoy under the protection of the state.
Taxation is progressive when its rate goes up depending on the
resources of the person affected.98
The VAT is an antithesis of progressive taxation. By its very nature, it is
regressive. The principle of progressive taxation has no relation with the
VAT system inasmuch as the VAT paid by the consumer or business for
every goods bought or services enjoyed is the same regardless of
income. In
other words, the VAT paid eats the same portion of an income, whether
big or small. The disparity lies in the income earned by a person or profit
margin marked by a business, such that the higher the income or profit
margin, the smaller the portion of the income or profit that is eaten by
VAT. A converso, the lower the income or profit margin, the bigger the
part that the VAT eats away. At the end of the day, it is really the lower
income group or businesses with low-profit margins that is always
hardest hit.
Nevertheless, the Constitution does not really prohibit the imposition of
indirect taxes, like the VAT. What it simply provides is that Congress shall
"evolve a progressive system of taxation." The Court stated in
the Tolentino case, thus:
The Constitution does not really prohibit the imposition of indirect taxes
which, like the VAT, are regressive. What it simply provides is that
Congress shall ‘evolve a progressive system of taxation.’ The
constitutional provision has been interpreted to mean simply that ‘direct
taxes are . . . to be preferred [and] as much as possible, indirect taxes
should be minimized.’ (E. FERNANDO, THE CONSTITUTION OF THE
PHILIPPINES 221 (Second ed. 1977)) Indeed, the mandate to Congress
is not to prescribe, but to evolve, a progressive tax system. Otherwise,
sales taxes, which perhaps are the oldest form of indirect taxes, would
have been prohibited with the proclamation of Art. VIII, §17 (1) of the
1973 Constitution from which the present Art. VI, §28 (1) was taken.
Sales taxes are also regressive.
Resort to indirect taxes should be minimized but not avoided entirely
because it is difficult, if not impossible, to avoid them by imposing such
taxes according to the taxpayers' ability to pay. In the case of the VAT,
the law minimizes the regressive effects of this imposition by providing for
zero rating of certain transactions (R.A. No. 7716, §3, amending §102 (b)
of the NIRC), while granting exemptions to other transactions. (R.A. No.
7716, §4 amending §103 of the NIRC)99
Let us likewise disabuse our minds from the notion that the judiciary is
the repository of remedies for all political or social ills; We should not
forget that the Constitution has judiciously allocated the powers of
government to three distinct and separate compartments; and that
judicial interpretation has tended to the preservation of the independence
of the three, and a zealous regard of the prerogatives of each, knowing
full well that one is not the guardian of the others and that, for official
wrong-doing, each may be brought to account, either by impeachment,
trial or by the ballot box.100
The words of the Court in Vera vs. Avelino101 holds true then, as it still
holds true now. All things considered, there is no raison d'être for the
unconstitutionality of R.A. No. 9337.
WHEREFORE, Republic Act No. 9337 not being unconstitutional, the
petitions in G.R. Nos. 168056, 168207, 168461, 168463, and 168730,
are hereby DISMISSED.
There being no constitutional impediment to the full enforcement and
implementation of R.A. No. 9337, the temporary restraining order issued
by the Court on July 1, 2005 is LIFTED upon finality of herein decision.
SO ORDERED.

CONCLUSION

It has been said that taxes are the lifeblood of the government. In this
case, it is just an enema, a first-aid measure to resuscitate an economy in
distress. The Court is neither blind nor is it turning a deaf ear on the plight
of the masses. But it does not have the panacea for the malady that the
law seeks to remedy. As in other cases, the Court cannot strike down a
law as unconstitutional simply because of its yokes.

Let us not be overly influenced by the plea that for every wrong there is a
remedy, and that the judiciary should stand ready to afford relief. There
are undoubtedly many wrongs the judicature may not correct, for
instance, those involving political questions. . . .
G.R. No. 181704 December 6, 2011
BUREAU OF CUSTOMS EMPLOYEES ASSOCIATION (BOCEA),
represented by its National President (BOCEA National Executive
Council) Mr. Romulo A. Pagulayan, Petitioner,
vs.
HON. MARGARITO B. TEVES, in his capacity as Secretary of the
Department of Finance, HON. NAPOLEON L. MORALES, in his
capacity as Commissioner of the Bureau of Customs, HON. LILIAN
B. HEFTI, in her capacity as Commissioner of the Bureau of Internal
Revenue, Respondents.
DECISION
VILLARAMA, JR., J.:
Before this Court is a petition1 for certiorari and prohibition with prayer for
injunctive relief/s under Rule 65 of the 1997 Rules of Civil Procedure, as
amended, to declare Republic Act (R.A.) No. 9335, 2 otherwise known as
the Attrition Act of 2005, and its Implementing Rules and
Regulations3 (IRR) unconstitutional, and the implementation thereof be
enjoined permanently.
The Facts
On January 25, 2005, former President Gloria Macapagal-Arroyo signed
into law R.A. No. 9335 which took effect on February 11, 2005.
In Abakada Guro Party List v. Purisima4 (Abakada), we said of R.A. No.
9335:
RA [No.] 9335 was enacted to optimize the revenue-generation capability
and collection of the Bureau of Internal Revenue (BIR) and the Bureau of
Customs (BOC). The law intends to encourage BIR and BOC officials
and employees to exceed their revenue targets by providing a system of
rewards and sanctions through the creation of a Rewards and Incentives
Fund (Fund) and a Revenue Performance Evaluation Board (Board). It
covers all officials and employees of the BIR and the BOC with at least
six months of service, regardless of employment status.
The Fund is sourced from the collection of the BIR and the BOC in
excess of their revenue targets for the year, as determined by the
Development Budget and Coordinating Committee (DBCC). Any
incentive or reward is taken from the fund and allocated to the BIR and
the BOC in proportion to their contribution in the excess collection of the
targeted amount of tax revenue.
The Boards in the BIR and the BOC are composed of the Secretary of
the Department of Finance (DOF) or his/her Undersecretary, the
Secretary of the Department of Budget and Management (DBM) or
his/her Undersecretary, the Director General of the National Economic
Development Authority (NEDA) or his/her Deputy Director General, the
Commissioners of the BIR and the BOC or their Deputy Commissioners,
two representatives from the rank-and-file employees and a
representative from the officials nominated by their recognized
organization.
Each Board has the duty to (1) prescribe the rules and guidelines for the
allocation, distribution and release of the Fund; (2) set criteria and
procedures for removing from the service officials and employees whose
revenue collection falls short of the target; (3) terminate personnel in
accordance with the criteria adopted by the Board; (4) prescribe a system
for performance evaluation; (5) perform other functions, including the
issuance of rules and regulations and (6) submit an annual report to
Congress.
The DOF, DBM, NEDA, BIR, BOC and the Civil Service Commission
(CSC) were tasked to promulgate and issue the implementing rules and
regulations of RA [No.] 9335, to be approved by a Joint Congressional
Oversight Committee created for such purpose. 5
The Joint Congressional Oversight Committee approved the assailed IRR
on May 22, 2006. Subsequently, the IRR was published on May 30, 2006
in two newspapers of general circulation, the Philippine Star and the
Manila Standard, and became effective fifteen (15) days later. 6
Contending that the enactment and implementation of R.A. No. 9335 are
tainted with constitutional infirmities in violation of the fundamental rights
of its members, petitioner Bureau of Customs Employees Association
(BOCEA), an association of rank-and-file employees of the Bureau of
Customs (BOC), duly registered with the Department of Labor and
Employment (DOLE) and the Civil Service Commission (CSC), and
represented by its National President, Mr. Romulo A. Pagulayan
(Pagulayan), directly filed the present petition before this Court against
respondents Margarito B. Teves, in his capacity as Secretary of the
Department of Finance (DOF), Commissioner Napoleon L. Morales
(Commissioner Morales), in his capacity as BOC Commissioner, and
Lilian B. Hefti, in her capacity as Commissioner of the Bureau of Internal
Revenue (BIR). In its petition, BOCEA made the following averments:
Sometime in 2008, high-ranking officials of the BOC pursuant to the
mandate of R.A. No. 9335 and its IRR, and in order to comply with the
stringent deadlines thereof, started to disseminate Collection District
Performance Contracts7 (Performance Contracts) for the lower ranking
officials and rank-and-file employees to sign. The Performance Contract
pertinently provided:
xxxx
WHEREAS, pursuant to the provisions of Sec. 25 (b) of the Implementing
Rules and Regulations (IRR) of the Attrition Act of 2005, that provides for
the setting of criteria and procedures for removing from the service
Officials and Employees whose revenue collection fall short of the target
in accordance with Section 7 of Republic Act 9335.
xxxx
NOW, THEREFORE, for and in consideration of the foregoing premises,
parties unto this Agreement hereby agree and so agreed to perform the
following:
xxxx
2. The "Section 2, PA/PE" hereby accepts the allocated Revenue
Collection Target and further accepts/commits to meet the said target
under the following conditions:
a.) That he/she will meet the allocated Revenue Collection Target
and thereby undertakes and binds himself/herself that in the
event the revenue collection falls short of the target with due
consideration of all relevant factors affecting the level of collection
as provided in the rules and regulations promulgated under the
Act and its IRR, he/she will voluntarily submit to the provisions of
Sec. 25 (b) of the IRR and Sec. 7 of the Act; and
b.) That he/she will cascade and/or allocate to respective
Appraisers/Examiners or Employees under his/her section the
said Revenue Collection Target and require them to execute a
Performance Contract, and direct them to accept their individual
target. The Performance Contract executed by the respective
Examiners/Appraisers/Employees shall be submitted to the Office
of the Commissioner through the LAIC on or before March 31,
2008.
x x x x8
BOCEA opined that the revenue target was impossible to meet due to the
Government’s own policies on reduced tariff rates and tax breaks to big
businesses, the occurrence of natural calamities and because of other
economic factors. BOCEA claimed that some BOC employees were
coerced and forced to sign the Performance Contract. The majority of
them, however, did not sign. In particular, officers of BOCEA were
summoned and required to sign the Performance Contracts but they also
refused. To ease the brewing tension, BOCEA claimed that its officers
sent letters, and sought several dialogues with BOC officials but the latter
refused to heed them.
In addition, BOCEA alleged that Commissioner Morales exerted heavy
pressure on the District Collectors, Chiefs of Formal Entry Divisions,
Principal Customs Appraisers and Principal Customs Examiners of the
BOC during command conferences to make them sign their Performance
Contracts. Likewise, BOC Deputy Commissioner Reynaldo Umali
(Deputy Commissioner Umali) individually spoke to said personnel to
convince them to sign said contracts. Said personnel were threatened
that if they do not sign their respective Performance Contracts, they
would face possible reassignment, reshuffling, or worse, be placed on
floating status. Thus, all the District Collectors, except a certain Atty.
Carlos So of the Collection District III of the Ninoy Aquino International
Airport (NAIA), signed the Performance Contracts.
BOCEA further claimed that Pagulayan was constantly harassed and
threatened with lawsuits. Pagulayan approached Deputy Commissioner
Umali to ask the BOC officials to stop all forms of harassment, but the
latter merely said that he would look into the matter. On February 5,
2008, BOCEA through counsel wrote the Revenue Performance
Evaluation Board (Board) to desist from implementing R.A. No. 9335 and
its IRR and from requiring rank-and-file employees of the BOC and BIR to
sign Performance Contracts.9 In his letter-reply10 dated February 12,
2008, Deputy Commissioner Umali denied having coerced any BOC
employee to sign a Performance Contract. He also defended the BOC,
invoking its mandate of merely implementing the law. Finally, Pagulayan
and BOCEA’s counsel, on separate occasions, requested for a certified
true copy of the Performance Contract from Deputy Commissioner Umali
but the latter failed to furnish them a copy.11
This petition was filed directly with this Court on March 3, 2008. BOCEA
asserted that in view of the unconstitutionality of R.A. No. 9335 and its
IRR, and their adverse effects on the constitutional rights of BOC officials
and employees, direct resort to this Court is justified. BOCEA argued,
among others, that its members and other BOC employees are in great
danger of losing their jobs should they fail to meet the required quota
provided under the law, in clear violation of their constitutional right to
security of tenure, and at their and their respective families’ prejudice.
In their Comment,12 respondents, through the Office of the Solicitor
General (OSG), countered that R.A. No. 9335 and its IRR do not violate
the right to due process and right to security of tenure of BIR and BOC
employees. The OSG stressed that the guarantee of security of tenure
under the 1987 Constitution is not a guarantee of perpetual employment.
R.A. No. 9335 and its IRR provided a reasonable and valid ground for the
dismissal of an employee which is germane to the purpose of the law.
Likewise, R.A. No. 9335 and its IRR provided that an employee may only
be separated from the service upon compliance with substantive and
procedural due process. The OSG added that R.A. No. 9335 and its IRR
must enjoy the presumption of constitutionality.
In its Reply,13 BOCEA claimed that R.A. No. 9335 employs means that
are unreasonable to achieve its stated objectives; that the law is unduly
oppressive of BIR and BOC employees as it shifts the extreme burden
upon their shoulders when the Government itself has adopted measures
that make collection difficult such as reduced tariff rates to almost zero
percent and tax exemption of big businesses; and that the law is
discriminatory of BIR and BOC employees. BOCEA manifested that only
the high-ranking officials of the BOC benefited largely from the reward
system under R.A. No. 9335 despite the fact that they were not the ones
directly toiling to collect revenue. Moreover, despite the BOCEA’s
numerous requests,14 BOC continually refused to provide BOCEA the
Expenditure Plan on how such reward was distributed.
Since BOCEA was seeking similar reliefs as that of the petitioners in
Abakada Guro Party List v. Purisima, BOCEA filed a Motion to
Consolidate15 the present case with Abakada on April 16, 2008. However,
pending action on said motion, the Court rendered its decision in
Abakada on August 14, 2008. Thus, the consolidation of this case with
Abakada was rendered no longer possible.16
In Abakada, this Court, through then Associate Justice, now Chief Justice
Renato C. Corona, declared Section 1217 of R.A. No. 9335 creating a
Joint Congressional Oversight Committee to approve the IRR as
unconstitutional and violative of the principle of separation of powers.
However, the constitutionality of the remaining provisions of R.A. No.
9335 was upheld pursuant to Section 1318 of R.A. No. 9335. The Court
also held that until the contrary is shown, the IRR of R.A. No. 9335 is
presumed valid and effective even without the approval of the Joint
Congressional Oversight Committee.19
Notwithstanding our ruling in Abakada, both parties complied with our
Resolution20 dated February 10, 2009, requiring them to submit their
respective Memoranda.
The Issues
BOCEA raises the following issues:
I.
WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.]
9335, AND ITS IMPLEMENTING RULES AND REGULATIONS ARE
UNCONSTITUTIONAL AS THESE VIOLATE THE RIGHT TO DUE
PROCESS OF THE COVERED BIR AND BOC OFFICIALS AND
EMPLOYEES[;]
II.
WHETHER OR NOT THE ATTRITION LAW, REPUBLIC ACT [NO.]
9335, AND ITS IMPLEMENTING RULES AND REGULATIONS ARE
UNCONSTITUTIONAL AS THESE VIOLATE THE RIGHT OF BIR AND
BOC OFFICIALS AND EMPLOYEES TO THE EQUAL PROTECTION OF
THE LAWS[;]
III.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS
IMPLEMENTING RULES AND REGULATIONS VIOLATE THE RIGHT
TO SECURITY OF TENURE OF BIR AND BOC OFFICIALS AND
EMPLOYEES AS ENSHRINED UNDER SECTION 2 (3), ARTICLE IX (B)
OF THE CONSTITUTION[;]
IV.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 AND ITS
IMPLEMENTING RULES AND REGULATIONS ARE
UNCONSTITUTIONAL AS THEY CONSTITUTE UNDUE DELEGATION
OF LEGISLATIVE POWERS TO THE REVENUE PERFORMANCE
EVALUATION BOARD IN VIOLATION OF THE PRINCIPLE OF
SEPARATION OF POWERS ENSHRINED IN THE CONSTITUTION[;
AND]
V.
WHETHER OR NOT REPUBLIC ACT [NO.] 9335 IS A BILL OF
ATTAINDER AND HENCE[,] UNCONSTITUTIONAL BECAUSE IT
INFLICTS PUNISHMENT THROUGH LEGISLATIVE FIAT UPON A
PARTICULAR GROUP OR CLASS OF OFFICIALS AND EMPLOYEES
WITHOUT TRIAL.21
BOCEA manifested that while waiting for the Court to give due course to
its petition, events unfolded showing the patent unconstitutionality of R.A.
No. 9335. It narrated that during the first year of the implementation of
R.A. No. 9335, BOC employees exerted commendable efforts to attain
their revenue target of ₱196 billion which they surpassed by as much as
₱2 billion for that year alone. However, this was attained only because oil
companies made advance tax payments to BOC. Moreover, BOC
employees were given their "reward" for surpassing said target only in
2008, the distribution of which they described as unjust, unfair, dubious
and fraudulent because only top officials of BOC got the huge sum of
reward while the employees, who did the hard task of collecting, received
a mere pittance of around ₱8,500.00. In the same manner, the Bonds
Division of BOC-NAIA collected 400+% of its designated target but the
higher management gave out to the employees a measly sum of
₱8,500.00 while the top level officials partook of millions of the excess
collections. BOCEA relies on a piece of information revealed by a
newspaper showing the list of BOC officials who apparently earned huge
amounts of money by way of reward.22 It claims that the recipients thereof
included lawyers, support personnel and other employees, including a
dentist, who performed no collection functions at all. These alleged
anomalous selection, distribution and allocation of rewards was due to
the failure of R.A. No. 9335 to set out clear guidelines. 23
In addition, BOCEA avers that the Board initiated the first few cases of
attrition for the Fiscal Year 2007 by subjecting five BOC officials from the
Port of Manila to attrition despite the fact that the Port of Manila
substantially complied with the provisions of R.A. No. 9335. It is thus
submitted that the selection of these officials for attrition without proper
investigation was nothing less than arbitrary. Further, the legislative and
executive departments’ promulgation of issuances and the Government’s
accession to regional trade agreements have caused a significant
diminution of the tariff rates, thus, decreasing over-all collection. These
unrealistic settings of revenue targets seriously affect BIR and BOC
employees tasked with the burden of collection, and worse, subjected
them to attrition.24
BOCEA assails the constitutionality of R.A. No. 9335 and its IRR on the
following grounds:
1. R.A. No. 9335 and its IRR violate the BIR and BOC employees’
right to due process because the termination of employees who
had not attained their revenue targets for the year is peremptory
and done without any form of hearing to allow said employees to
ventilate their side. Moreover, R.A. No. 9335 and its IRR do not
comply with the requirements under CSC rules and regulations as
the dismissal in this case is immediately executory. Such
immediately executory nature of the Board’s decision negates the
remedies available to an employee as provided under the CSC
rules.
2. R.A. No. 9335 and its IRR violate the BIR and BOC employees’
right to equal protection of the law because R.A. No. 9335 and its
IRR unduly discriminates against BIR and BOC employees as
compared to employees of other revenue generating government
agencies like the Philippine Amusement and Gaming
Corporation, Department of Transportation and Communication,
the Air Transportation Office, the Land Transportation Office, and
the Philippine Charity Sweepstakes Office, among others, which
are not subject to attrition.
3. R.A. No. 9335 and its IRR violate the BIR and BOC employees’
right to security of tenure because R.A. No. 9335 and its IRR
effectively removed remedies provided in the ordinary course of
administrative procedure afforded to government employees. The
law likewise created another ground for dismissal, i.e., non-
attainment of revenue collection target, which is not provided
under CSC rules and which is, by its nature, unpredictable and
therefore arbitrary and unreasonable.
4. R.A. No. 9335 and its IRR violate the 1987
Constitution because Congress granted to the Revenue
 Performance Evaluation Board (Board) the unbridled discretion of
formulating the criteria for termination, the manner of allocating
targets, the distribution of rewards and the determination of
relevant factors affecting the targets of collection, which is
tantamount to undue delegation of legislative power.
5. R.A. No. 9335 is a bill of attainder because it inflicts
punishment upon a particular group or class of officials and
employees without trial. This is evident from the fact that the law
confers upon the Board the power to impose the penalty of
removal upon employees who do not meet their revenue targets;
that the same is without the benefit of hearing; and that the
removal from service is immediately executory. Lastly, it
disregards the presumption of regularity in the performance of the
official functions of a public officer.25
On the other hand, respondents through the OSG stress that except for
Section 12 of R.A. No. 9335, R.A. No. 9335 and its IRR are
constitutional, as per our ruling in Abakada. Nevertheless, the OSG
argues that the classification of BIR and BOC employees as public
officers under R.A. No. 9335 is based on a valid and substantial
distinction since the revenue generated by the BIR and BOC is
essentially in the form of taxes, which is the lifeblood of the State, while
the revenue produced by other agencies is merely incidental or
secondary to their governmental functions; that in view of their mandate,
and for purposes of tax collection, the BIR and BOC are sui generis; that
R.A. No. 9335 complies with the "completeness" and "sufficient standard"
tests for the permissive delegation of legislative power to the Board; that
the Board exercises its delegated power consistent with the policy laid
down in the law, that is, to optimize the revenue generation capability and
collection of the BIR and the BOC; that parameters were set in order that
the Board may identify the officials and employees subject to attrition,
and the proper procedure for their removal in case they fail to meet the
targets set in the Performance Contract were provided; and that the
rights of BIR and BOC employees to due process of law and security of
tenure are duly accorded by R.A. No. 9335. The OSG likewise maintains
that there was no encroachment of judicial power in the enactment of
R.A. No. 9335 amounting to a bill of attainder since R.A. No. 9335 and its
IRR merely defined the offense and provided for the penalty that may be
imposed. Finally, the OSG reiterates that the separation from the service
of any BIR or BOC employee under R.A. No. 9335 and its IRR shall be
done only upon due consideration of all relevant factors affecting the
level of collection, subject to Civil Service laws, rules and regulations,
and in compliance with substantive and procedural due process. The
OSG opines that the Performance Contract, far from violating the BIR
and BOC employees’ right to due process, actually serves as a notice of
the revenue target they have to meet and the possible consequences of
failing to meet the same. More, there is nothing in the law which prevents
the aggrieved party from appealing the unfavorable decision of
dismissal.26
In essence, the issues for our resolution are:
1. Whether there is undue delegation of legislative power to the
Board;
2. Whether R.A. No. 9335 and its IRR violate the rights of
BOCEA’s members to: (a) equal protection of laws, (b) security of
tenure and (c) due process; and
3. Whether R.A. No. 9335 is a bill of attainder.
Our Ruling
Prefatorily, we note that it is clear, and in fact uncontroverted, that
BOCEA has locus standi. BOCEA impugns the constitutionality of R.A.
No. 9335 and its IRR because its members, who are rank-and-file
employees of the BOC, are actually covered by the law and its IRR.
BOCEA’s members have a personal and substantial interest in the case,
such that they have sustained or will sustain, direct injury as a result of
the enforcement of R.A. No. 9335 and its IRR. 27
However, we find no merit in the petition and perforce dismiss the same.
It must be noted that this is not the first time the constitutionality of R.A.
No. 9335 and its IRR are being challenged. The Court already settled the
majority of the same issues raised by BOCEA in our decision in Abakada,
which attained finality on September 17, 2008. As such, our ruling therein
is worthy of reiteration in this case.
We resolve the first issue in the negative.
The principle of separation of powers ordains that each of the three great
branches of government has exclusive cognizance of and is supreme in
matters falling within its own constitutionally allocated
sphere.28 Necessarily imbedded in this doctrine is the principle of non-
delegation of powers, as expressed in the Latin maxim potestas delegata
non delegari potest, which means "what has been delegated, cannot be
delegated." This doctrine is based on the ethical principle that such
delegated power constitutes not only a right but a duty to be performed
by the delegate through the instrumentality of his own judgment and not
through the intervening mind of another. 29 However, this principle of non-
delegation of powers admits of numerous exceptions, 30 one of which is
the delegation of legislative power to various specialized administrative
agencies like the Board in this case.
The rationale for the aforementioned exception was clearly explained in
our ruling in Gerochi v. Department of Energy, 31 to wit:
In the face of the increasing complexity of modern life, delegation of
legislative power to various specialized administrative agencies is
allowed as an exception to this principle. Given the volume and variety of
interactions in today’s society, it is doubtful if the legislature can
promulgate laws that will deal adequately with and respond promptly to
the minutiae of everyday life. Hence, the need to delegate to
administrative bodies — the principal agencies tasked to execute laws in
their specialized fields — the authority to promulgate rules and
regulations to implement a given statute and effectuate its policies. All
that is required for the valid exercise of this power of subordinate
legislation is that the regulation be germane to the objects and purposes
of the law and that the regulation be not in contradiction to, but in
conformity with, the standards prescribed by the law. These requirements
are denominated as the completeness test and the sufficient standard
test.32
Thus, in Abakada, we held,
Two tests determine the validity of delegation of legislative power: (1) the
completeness test and (2) the sufficient standard test. A law is complete
when it sets forth therein the policy to be executed, carried out or
implemented by the delegate. It lays down a sufficient standard when it
provides adequate guidelines or limitations in the law to map out the
boundaries of the delegate’s authority and prevent the delegation from
running riot. To be sufficient, the standard must specify the limits of the
delegate’s authority, announce the legislative policy and identify the
conditions under which it is to be implemented.
RA [No.] 9335 adequately states the policy and standards to guide the
President in fixing revenue targets and the implementing agencies in
carrying out the provisions of the law. Section 2 spells out the policy of
the law:
"SEC. 2. Declaration of Policy. — It is the policy of the State to optimize
the revenue-generation capability and collection of the Bureau of Internal
Revenue (BIR) and the Bureau of Customs (BOC) by providing for a
system of rewards and sanctions through the creation of a Rewards and
Incentives Fund and a Revenue Performance Evaluation Board in the
above agencies for the purpose of encouraging their officials and
employees to exceed their revenue targets."
Section 4 "canalized within banks that keep it from overflowing" the
delegated power to the President to fix revenue targets:
"SEC. 4. Rewards and Incentives Fund. — A Rewards and Incentives
Fund, hereinafter referred to as the Fund, is hereby created, to be
sourced from the collection of the BIR and the BOC in excess of their
respective revenue targets of the year, as determined by the
Development Budget and Coordinating Committee (DBCC), in the
following percentages:
Excess of Collection Percent (%) of the
[Over] the Revenue Excess Collection to
Targets Accrue to the Fund
30% or below — 15%
More than 30% — 15% of the first 30%
plus 20% of the
remaining excess
The Fund shall be deemed automatically appropriated the year
immediately following the year when the revenue collection target was
exceeded and shall be released on the same fiscal year.
Revenue targets shall refer to the original estimated revenue collection
expected of the BIR and the BOC for a given fiscal year as stated in the
Budget of Expenditures and Sources of Financing (BESF) submitted by
the President to Congress. The BIR and the BOC shall submit to the
DBCC the distribution of the agencies’ revenue targets as allocated
among its revenue districts in the case of the BIR, and the collection
districts in the case of the BOC.
xxx xxx x x x"
Revenue targets are based on the original estimated revenue collection
expected respectively of the BIR and the BOC for a given fiscal year as
approved by the DBCC and stated in the BESF submitted by the
President to Congress. Thus, the determination of revenue targets does
not rest solely on the President as it also undergoes the scrutiny of the
DBCC.
On the other hand, Section 7 specifies the limits of the Board’s authority
and identifies the conditions under which officials and employees whose
revenue collection falls short of the target by at least 7.5% may be
removed from the service:
"SEC. 7. Powers and Functions of the Board. — The Board in the agency
shall have the following powers and functions:
xxx xxx xxx
(b) To set the criteria and procedures for removing from service officials
and employees whose revenue collection falls short of the target by at
least seven and a half percent (7.5%), with due consideration of all
relevant factors affecting the level of collection as provided in the rules
and regulations promulgated under this Act, subject to civil service laws,
rules and regulations and compliance with substantive and procedural
due process: Provided, That the following exemptions shall apply:
1. Where the district or area of responsibility is newly-created, not
exceeding two years in operation, and has no historical record of
collection performance that can be used as basis for evaluation;
and
2. Where the revenue or customs official or employee is a recent
transferee in the middle of the period under consideration unless
the transfer was due to nonperformance of revenue targets or
potential nonperformance of revenue targets: Provided, however,
That when the district or area of responsibility covered by
revenue or customs officials or employees has suffered from
economic difficulties brought about by natural calamities or force
majeure or economic causes as may be determined by the
Board, termination shall be considered only after careful and
proper review by the Board.
(c) To terminate personnel in accordance with the criteria adopted in the
preceding paragraph: Provided, That such decision shall be immediately
executory: Provided, further, That the application of the criteria for the
separation of an official or employee from service under this Act shall be
without prejudice to the application of other relevant laws on
accountability of public officers and employees, such as the Code of
Conduct and Ethical Standards of Public Officers and Employees and the
Anti-Graft and Corrupt Practices Act;
xxx xxx x x x"
At any rate, this Court has recognized the following as sufficient
standards: "public interest", "justice and equity", "public convenience and
welfare" and "simplicity, economy and welfare". In this case, the declared
policy of optimization of the revenue-generation capability and collection
of the BIR and the BOC is infused with public interest.33
We could not but deduce that the completeness test and the sufficient
standard test were fully satisfied by R.A. No. 9335, as evident from the
aforementioned Sections 2, 4 and 7 thereof. Moreover, Section 5 34 of
R.A. No. 9335 also provides for the incentives due to District Collection
Offices. While it is apparent that the last paragraph of Section 5 provides
that "[t]he allocation, distribution and release of the district reward shall
likewise be prescribed by the rules and regulations of the Revenue
Performance and Evaluation Board," Section 7 (a) 35 of R.A. No. 9335
clearly mandates and sets the parameters for the Board by providing that
such rules and guidelines for the allocation, distribution and release of
the fund shall be in accordance with Sections 4 and 5 of R.A. No. 9335.
In sum, the Court finds that R.A. No. 9335, read and appreciated in its
entirety, is complete in all its essential terms and conditions, and that it
contains sufficient standards as to negate BOCEA’s supposition of undue
delegation of legislative power to the Board.
Similarly, we resolve the second issue in the negative.
Equal protection simply provides that all persons or things similarly
situated should be treated in a similar manner, both as to rights conferred
and responsibilities imposed. The purpose of the equal protection clause
is to secure every person within a state’s jurisdiction against intentional
and arbitrary discrimination, whether occasioned by the express terms of
a statute or by its improper execution through the state’s duly constituted
authorities. In other words, the concept of equal justice under the law
requires the state to govern impartially, and it may not draw distinctions
between individuals solely on differences that are irrelevant to a
legitimate governmental objective.36 1awphil
Thus, on the issue on equal protection of the laws, we held in Abakada:
The equal protection clause recognizes a valid classification, that is, a
classification that has a reasonable foundation or rational basis and not
arbitrary. With respect to RA [No.] 9335, its expressed public policy is the
optimization of the revenue-generation capability and collection of the
BIR and the BOC. Since the subject of the law is the revenue-generation
capability and collection of the BIR and the BOC, the incentives and/or
sanctions provided in the law should logically pertain to the said
agencies. Moreover, the law concerns only the BIR and the BOC
because they have the common distinct primary function of generating
revenues for the national government through the collection of taxes,
customs duties, fees and charges.
The BIR performs the following functions:
"Sec. 18. The Bureau of Internal Revenue. — The Bureau of Internal
Revenue, which shall be headed by and subject to the supervision and
control of the Commissioner of Internal Revenue, who shall be appointed
by the President upon the recommendation of the Secretary [of the DOF],
shall have the following functions:
(1) Assess and collect all taxes, fees and charges and account for
all revenues collected;
(2) Exercise duly delegated police powers for the proper
performance of its functions and duties;
(3) Prevent and prosecute tax evasions and all other illegal
economic activities;
(4) Exercise supervision and control over its constituent and
subordinate units; and
(5) Perform such other functions as may be provided by law.
xxx xxx x x x"
On the other hand, the BOC has the following functions:
"Sec. 23. The Bureau of Customs. — The Bureau of Customs which shall
be headed and subject to the management and control of the
Commissioner of Customs, who shall be appointed by the President upon
the recommendation of the Secretary [of the DOF] and hereinafter
referred to as Commissioner, shall have the following functions:
(1) Collect custom duties, taxes and the corresponding fees,
charges and penalties;
(2) Account for all customs revenues collected;
(3) Exercise police authority for the enforcement of tariff and
customs laws;
(4) Prevent and suppress smuggling, pilferage and all other
economic frauds within all ports of entry;
(5) Supervise and control exports, imports, foreign mails and the
clearance of vessels and aircrafts in all ports of entry;
(6) Administer all legal requirements that are appropriate;
(7) Prevent and prosecute smuggling and other illegal activities in
all ports under its jurisdiction;
(8) Exercise supervision and control over its constituent units;
(9) Perform such other functions as may be provided by law.
xxx xxx x x x"
Both the BIR and the BOC are bureaus under the DOF. They principally
perform the special function of being the instrumentalities through which
the State exercises one of its great inherent functions — taxation.
Indubitably, such substantial distinction is germane and intimately related
to the purpose of the law. Hence, the classification and treatment
accorded to the BIR and the BOC under RA [No.] 9335 fully satisfy the
demands of equal protection.37
As it was imperatively correlated to the issue on equal protection, the
issues on the security of tenure of affected BIR and BOC officials and
employees and their entitlement to due process were also settled in
Abakada:
Clearly, RA [No.] 9335 in no way violates the security of tenure of officials
and employees of the BIR and the BOC. The guarantee of security of
tenure only means that an employee cannot be dismissed from the
service for causes other than those provided by law and only after due
process is accorded the employee. In the case of RA [No.] 9335, it lays
down a reasonable yardstick for removal (when the revenue collection
falls short of the target by at least 7.5%) with due consideration of all
relevant factors affecting the level of collection. This standard is
analogous to inefficiency and incompetence in the performance of official
duties, a ground for disciplinary action under civil service laws. The action
for removal is also subject to civil service laws, rules and regulations and
compliance with substantive and procedural due process.38
In addition, the essence of due process is simply an opportunity to be
heard, or as applied to administrative proceedings, a fair and reasonable
opportunity to explain one’s side.39 BOCEA’s apprehension of deprivation
of due process finds its answer in Section 7 (b) and (c) of R.A. No.
9335.40 The concerned BIR or BOC official or employee is not simply
given a target revenue collection and capriciously left without any quarter.
R.A. No. 9335 and its IRR clearly give due consideration to all relevant
factors41 that may affect the level of collection. In the same manner,
exemptions42 were set, contravening BOCEA’s claim that its members
may be removed for unattained target collection even due to causes
which are beyond their control. Moreover, an employee’s right to be
heard is not at all prevented and his right to appeal is not deprived of
him.43 In fine, a BIR or BOC official or employee in this case cannot be
arbitrarily removed from the service without according him his
constitutional right to due process. No less than R.A. No. 9335 in
accordance with the 1987 Constitution guarantees this.
We have spoken, and these issues were finally laid to rest. Now, the
Court proceeds to resolve the last, but new issue raised by BOCEA, that
is, whether R.A. No. 9335 is a bill of attainder proscribed under Section
22,44 Article III of the 1987 Constitution.
On this score, we hold that R.A. No. 9335 is not a bill of attainder. A bill of
attainder is a legislative act which inflicts punishment on individuals or
members of a particular group without a judicial trial. Essential to a bill of
attainder are a specification of certain individuals or a group of
individuals, the imposition of a punishment, penal or otherwise, and the
lack of judicial trial.45
1avvphi1
In his Concurring Opinion in Tuason v. Register of Deeds, Caloocan
City,46 Justice Florentino P. Feliciano traces the roots of a Bill of
Attainder, to wit:
Bills of attainder are an ancient instrument of tyranny. In England a few
centuries back, Parliament would at times enact bills or statutes which
declared certain persons attainted and their blood corrupted so that it lost
all heritable quality (Ex Parte Garland, 4 Wall. 333, 18 L.Ed. 366 [1867]).
In more modern terms, a bill of attainder is essentially a usurpation of
judicial power by a legislative body. It envisages and effects the
imposition of a penalty — the deprivation of life or liberty or property —
not by the ordinary processes of judicial trial, but by legislative fiat. While
cast in the form of special legislation, a bill of attainder (or bill of pains
and penalties, if it prescribed a penalty other than death) is in intent and
effect a penal judgment visited upon an identified person or group of
persons (and not upon the general community) without a prior charge or
demand, without notice and hearing, without an opportunity to defend,
without any of the civilized forms and safeguards of the judicial process
as we know it (People v. Ferrer, 48 SCRA 382 [1972]; Cummings and
Missouri, 4 Wall. 277, 18 L. Ed. 356 [1867]; U.S. v. Lovett, 328, U.S. 303,
90 L.Ed. 1252 [1945]; U.S. v. Brown, 381 U.S. 437, 14 L.Ed. 2d. 484
[1965]. Such is the archetypal bill of attainder wielded as a means of
legislative oppression. x x x47
R.A. No. 9335 does not possess the elements of a bill of attainder. It
does not seek to inflict punishment without a judicial trial. R.A. No. 9335
merely lays down the grounds for the termination of a BIR or BOC official
or employee and provides for the consequences thereof. The democratic
processes are still followed and the constitutional rights of the concerned
employee are amply protected.
A final note.
We find that BOCEA’s petition is replete with allegations of defects and
anomalies in allocation, distribution and receipt of rewards. While BOCEA
intimates that it intends to curb graft and corruption in the BOC in
particular and in the government in general which is nothing but noble,
these intentions do not actually pertain to the constitutionality of R.A. No.
9335 and its IRR, but rather in the faithful implementation thereof. R.A.
No. 9335 itself does not tolerate these pernicious acts of graft and
corruption.48 As the Court is not a trier of facts, the investigation on the
veracity of, and the proper action on these anomalies are in the hands of
the Executive branch. Correlatively, the wisdom for the enactment of this
law remains within the domain of the Legislative branch. We merely
interpret the law as it is. The Court has no discretion to give statutes a
meaning detached from the manifest intendment and language
thereof.49 Just like any other law, R.A. No. 9335 has in its favor the
presumption of constitutionality, and to justify its nullification, there must
be a clear and unequivocal breach of the Constitution and not one that is
doubtful, speculative, or argumentative. 50 We have so declared in
Abakada, and we now reiterate that R.A. No. 9335 and its IRR are
constitutional.
WHEREFORE, the present petition for certiorari and prohibition with
prayer for injunctive relief/s is DISMISSED.
No costs.
SO ORDERED.
MARTIN S. VILLARAMA, JR.
Associate Justice
G.R. No. 170516 July 16, 2008
AKBAYAN CITIZENS ACTION PARTY ("AKBAYAN"), PAMBANSANG
KATIPUNAN NG MGA SAMAHAN SA KANAYUNAN ("PKSK"),
ALLIANCE OF PROGRESSIVE LABOR ("APL"), VICENTE A. FABE,
ANGELITO R. MENDOZA, MANUEL P. QUIAMBAO, ROSE BEATRIX
CRUZ-ANGELES, CONG. LORENZO R. TANADA III, CONG. MARIO
JOYO AGUJA, CONG. LORETA ANN P. ROSALES, CONG. ANA
THERESIA HONTIVEROS-BARAQUEL, AND CONG. EMMANUEL
JOEL J. VILLANUEVA, Petitioners,
vs.
THOMAS G. AQUINO, in his capacity as Undersecretary of the
Department of Trade and Industry (DTI) and Chairman and Chief
Delegate of the Philippine Coordinating Committee (PCC) for the
Japan-Philippines Economic Partnership Agreement, EDSEL T.
CUSTODIO, in his capacity as Undersecretary of the Department of
Foreign Affairs (DFA) and Co-Chair of the PCC for the JPEPA,
EDGARDO ABON, in his capacity as Chairman of the Tariff
Commission and lead negotiator for Competition Policy and
Emergency Measures of the JPEPA, MARGARITA SONGCO, in her
capacity as Assistant Director-General of the National Economic
Development Authority (NEDA) and lead negotiator for Trade in
Services and Cooperation of the JPEPA, MALOU MONTERO, in her
capacity as Foreign Service Officer I, Office of the Undersecretary
for International Economic Relations of the DFA and lead negotiator
for the General and Final Provisions of the JPEPA, ERLINDA
ARCELLANA, in her capacity as Director of the Board of
Investments and lead negotiator for Trade in Goods (General Rules)
of the JPEPA, RAQUEL ECHAGUE, in her capacity as lead
negotiator for Rules of Origin of the JPEPA, GALLANT SORIANO, in
his official capacity as Deputy Commissioner of the Bureau of
Customs and lead negotiator for Customs Procedures and
Paperless Trading of the JPEPA, MA. LUISA GIGETTE IMPERIAL, in
her capacity as Director of the Bureau of Local Employment of the
Department of Labor and Employment (DOLE) and lead negotiator
for Movement of Natural Persons of the JPEPA, PASCUAL DE
GUZMAN, in his capacity as Director of the Board of Investments
and lead negotiator for Investment of the JPEPA, JESUS
MOTOOMULL, in his capacity as Director for the Bureau of Product
Standards of the DTI and lead negotiator for Mutual Recognition of
the JPEPA, LOUIE CALVARIO, in his capacity as lead negotiator for
Intellectual Property of the JPEPA, ELMER H. DORADO, in his
capacity as Officer-in-Charge of the Government Procurement
Policy Board Technical Support Office, the government agency that
is leading the negotiations on Government Procurement of the
JPEPA, RICARDO V. PARAS, in his capacity as Chief State Counsel
of the Department of Justice (DOJ) and lead negotiator for Dispute
Avoidance and Settlement of the JPEPA, ADONIS SULIT, in his
capacity as lead negotiator for the General and Final Provisions of
the JPEPA, EDUARDO R. ERMITA, in his capacity as Executive
Secretary, and ALBERTO ROMULO, in his capacity as Secretary of
the DFA,* Respondents.
DECISION
CARPIO MORALES, J.:
Petitioners – non-government organizations, Congresspersons, citizens
and taxpayers – seek via the present petition for mandamus and
prohibition to obtain from respondents the full text of the Japan-
Philippines Economic Partnership Agreement (JPEPA) including the
Philippine and Japanese offers submitted during the negotiation process
and all pertinent attachments and annexes thereto.
Petitioners Congressmen Lorenzo R. Tañada III and Mario Joyo Aguja
filed on January 25, 2005 House Resolution No. 551 calling for an inquiry
into the bilateral trade agreements then being negotiated by the
Philippine government, particularly the JPEPA. The Resolution became
the basis of an inquiry subsequently conducted by the House Special
Committee on Globalization (the House Committee) into the negotiations
of the JPEPA.
In the course of its inquiry, the House Committee requested herein
respondent Undersecretary Tomas Aquino (Usec. Aquino), Chairman of
the Philippine Coordinating Committee created under Executive Order
No. 213 ("Creation of A Philippine Coordinating Committee to Study the
Feasibility of the Japan-Philippines Economic Partnership
Agreement")1 to study and negotiate the proposed JPEPA, and to furnish
the Committee with a copy of the latest draft of the JPEPA. Usec. Aquino
did not heed the request, however.
Congressman Aguja later requested for the same document, but Usec.
Aquino, by letter of November 2, 2005, replied that the Congressman
shall be provided with a copy thereof "once the negotiations are
completed and as soon as a thorough legal review of the proposed
agreement has been conducted."
In a separate move, the House Committee, through Congressman
Herminio G. Teves, requested Executive Secretary Eduardo Ermita to
furnish it with "all documents on the subject including the latest draft of
the proposed agreement, the requests and offers etc." 2 Acting on the
request, Secretary Ermita, by letter of June 23, 2005, wrote
Congressman Teves as follows:
In its letter dated 15 June 2005 (copy enclosed), [the] D[epartment of]
F[oreign] A[ffairs] explains that the Committee’s request to be
furnished all documents on the JPEPA may be difficult to
accomplish at this time, since the proposed Agreement has been a
work in progress for about three years. A copy of the draft JPEPA will
however be forwarded to the Committee as soon as the text thereof is
settled and complete. (Emphasis supplied)
Congressman Aguja also requested NEDA Director-General Romulo Neri
and Tariff Commission Chairman Edgardo Abon, by letter of July 1, 2005,
for copies of the latest text of the JPEPA.
Chairman Abon replied, however, by letter of July 12, 2005 that the Tariff
Commission does not have a copy of the documents being requested,
albeit he was certain that Usec. Aquino would provide the Congressman
with a copy "once the negotiation is completed." And by letter of July 18,
2005, NEDA Assistant Director-General Margarita R. Songco informed
the Congressman that his request addressed to Director-General Neri
had been forwarded to Usec. Aquino who would be "in the best position
to respond" to the request.
In its third hearing conducted on August 31, 2005, the House Committee
resolved to issue a subpoena for the most recent draft of the JPEPA, but
the same was not pursued because by Committee Chairman
Congressman Teves’ information, then House Speaker Jose de Venecia
had requested him to hold in abeyance the issuance of the subpoena
until the President gives her consent to the disclosure of the documents. 3
Amid speculations that the JPEPA might be signed by the Philippine
government within December 2005, the present petition was filed on
December 9, 2005.4 The agreement was to be later signed on September
9, 2006 by President Gloria Macapagal-Arroyo and Japanese Prime
Minister Junichiro Koizumi in Helsinki, Finland, following which the
President endorsed it to the Senate for its concurrence pursuant to Article
VII, Section 21 of the Constitution. To date, the JPEPA is still being
deliberated upon by the Senate.
The JPEPA, which will be the first bilateral free trade agreement to be
entered into by the Philippines with another country in the event the
Senate grants its consent to it, covers a broad range of topics which
respondents enumerate as follows: trade in goods, rules of origin,
customs procedures, paperless trading, trade in services, investment,
intellectual property rights, government procurement, movement of
natural persons, cooperation, competition policy, mutual recognition,
dispute avoidance and settlement, improvement of the business
environment, and general and final provisions. 5
While the final text of the JPEPA has now been made accessible to the
public since September 11, 2006,6 respondents do not dispute that, at the
time the petition was filed up to the filing of petitioners’ Reply – when the
JPEPA was still being negotiated – the initial drafts thereof were kept
from public view.
Before delving on the substantive grounds relied upon by petitioners in
support of the petition, the Court finds it necessary to first resolve some
material procedural issues.
Standing
For a petition for mandamus such as the one at bar to be given due
course, it must be instituted by a party aggrieved by the alleged inaction
of any tribunal, corporation, board or person which unlawfully excludes
said party from the enjoyment of a legal right. 7 Respondents deny that
petitioners have such standing to sue. "[I]n the interest of a speedy and
definitive resolution of the substantive issues raised," however,
respondents consider it sufficient to cite a portion of the ruling in Pimentel
v. Office of Executive Secretary8 which emphasizes the need for a
"personal stake in the outcome of the controversy" on questions of
standing.
In a petition anchored upon the right of the people to information on
matters of public concern, which is a public right by its very nature,
petitioners need not show that they have any legal or special interest in
the result, it being sufficient to show that they are citizens and, therefore,
part of the general public which possesses the right. 9 As the present
petition is anchored on the right to information and petitioners are all
suing in their capacity as citizens and groups of citizens including
petitioners-members of the House of Representatives who additionally
are suing in their capacity as such, the standing of petitioners to file the
present suit is grounded in jurisprudence.
Mootness
Considering, however, that "[t]he principal relief petitioners are praying for
is the disclosure of the contents of the JPEPA prior to its finalization
between the two States parties,"10 public disclosure of the text of the
JPEPA after its signing by the President, during the pendency of the
present petition, has been largely rendered moot and academic.
With the Senate deliberations on the JPEPA still pending, the agreement
as it now stands cannot yet be considered as final and binding between
the two States. Article 164 of the JPEPA itself provides that the
agreement does not take effect immediately upon the signing thereof. For
it must still go through the procedures required by the laws of each
country for its entry into force, viz:
Article 164
Entry into Force
This Agreement shall enter into force on the thirtieth day after the date on
which the Governments of the Parties exchange diplomatic notes
informing each other that their respective legal procedures necessary
for entry into force of this Agreement have been completed. It shall
remain in force unless terminated as provided for in Article
165.11 (Emphasis supplied)
President Arroyo’s endorsement of the JPEPA to the Senate for
concurrence is part of the legal procedures which must be met prior to
the agreement’s entry into force.
The text of the JPEPA having then been made accessible to the public,
the petition has become moot and academic to the extent that it seeks
the disclosure of the "full text" thereof.
The petition is not entirely moot, however, because petitioners seek to
obtain, not merely the text of the JPEPA, but also the Philippine and
Japanese offers in the course of the negotiations.12
A discussion of the substantive issues, insofar as they impinge on
petitioners’ demand for access to the Philippine and Japanese offers, is
thus in order.
Grounds relied upon by petitioners
Petitioners assert, first, that the refusal of the government to disclose the
documents bearing on the JPEPA negotiations violates their right to
information on matters of public concern13 and contravenes other
constitutional provisions on transparency, such as that on the policy of
full public disclosure of all transactions involving public interest. 14 Second,
they contend that non-disclosure of the same documents undermines
their right to effective and reasonable participation in all levels of social,
political, and economic decision-making.15 Lastly, they proffer that
divulging the contents of the JPEPA only after the agreement has been
concluded will effectively make the Senate into a mere rubber stamp of
the Executive, in violation of the principle of separation of powers.
Significantly, the grounds relied upon by petitioners for the disclosure of
the latest text of the JPEPA are, except for the last, the same as those
cited for the disclosure of the Philippine and Japanese offers.
The first two grounds relied upon by petitioners which bear on the merits
of respondents’ claim of privilege shall be discussed. The last, being
purely speculatory given that the Senate is still deliberating on the
JPEPA, shall not.
The JPEPA is a matter of public concern
To be covered by the right to information, the information sought must
meet the threshold requirement that it be a matter of public concern.
Apropos is the teaching of Legaspi v. Civil Service Commission:
In determining whether or not a particular information is of public concern
there is no rigid test which can be applied. ‘Public concern’ like ‘public
interest’ is a term that eludes exact definition. Both terms embrace a
broad spectrum of subjects which the public may want to know, either
because these directly affect their lives, or simply because such matters
naturally arouse the interest of an ordinary citizen. In the final analysis, it
is for the courts to determine on a case by case basis whether the matter
at issue is of interest or importance, as it relates to or affects the
public.16 (Underscoring supplied)
From the nature of the JPEPA as an international trade agreement, it is
evident that the Philippine and Japanese offers submitted during the
negotiations towards its execution are matters of public concern. This,
respondents do not dispute. They only claim that diplomatic negotiations
are covered by the doctrine of executive privilege, thus constituting an
exception to the right to information and the policy of full public
disclosure.
Respondents’ claim of privilege
It is well-established in jurisprudence that neither the right to information
nor the policy of full public disclosure is absolute, there being matters
which, albeit of public concern or public interest, are recognized as
privileged in nature. The types of information which may be considered
privileged have been elucidated in Almonte v. Vasquez,17 Chavez v.
PCGG,18 Chavez v. Public Estate’s Authority,19 and most recently
in Senate v. Ermita20 where the Court reaffirmed the validity of the
doctrine of executive privilege in this jurisdiction and dwelt on its scope.
Whether a claim of executive privilege is valid depends on the ground
invoked to justify it and the context in which it is made.21 In the present
case, the ground for respondents’ claim of privilege is set forth in
their Comment, viz:
x x x The categories of information that may be considered privileged
includes matters of diplomatic character and under negotiation and
review. In this case, the privileged character of the diplomatic
negotiations has been categorically invoked and clearly explained by
respondents particularly respondent DTI Senior Undersecretary.
The documents on the proposed JPEPA as well as the text which is
subject to negotiations and legal review by the parties fall under the
exceptions to the right of access to information on matters of public
concern and policy of public disclosure. They come within the coverage
of executive privilege. At the time when the Committee was requesting for
copies of such documents, the negotiations were ongoing as they are still
now and the text of the proposed JPEPA is still uncertain and subject to
change. Considering the status and nature of such documents then and
now, these are evidently covered by executive privilege consistent with
existing legal provisions and settled jurisprudence.
Practical and strategic considerations likewise counsel against the
disclosure of the "rolling texts" which may undergo radical change or
portions of which may be totally abandoned. Furthermore,
the negotiations of the representatives of the Philippines as well as
of Japan must be allowed to explore alternatives in the course of the
negotiations in the same manner as judicial deliberations and
working drafts of opinions are accorded strict
confidentiality.22 (Emphasis and underscoring supplied)
The ground relied upon by respondents is thus not simply that the
information sought involves a diplomatic matter, but that it pertains
to diplomatic negotiations then in progress.
Privileged character of diplomatic negotiations
The privileged character of diplomatic negotiations has been recognized
in this jurisdiction. In discussing valid limitations on the right to
information, the Court in Chavez v. PCGG held that "information on inter-
government exchanges prior to the conclusion of treaties and executive
agreements may be subject to reasonable safeguards for the sake of
national interest."23 Even earlier, the same privilege was upheld
in People’s Movement for Press Freedom (PMPF) v.
Manglapus24 wherein the Court discussed the reasons for the privilege in
more precise terms.
In PMPF v. Manglapus, the therein petitioners were seeking information
from the President’s representatives on the state of the then on-going
negotiations of the RP-US Military Bases Agreement.25 The Court denied
the petition, stressing that "secrecy of negotiations with foreign
countries is not violative of the constitutional provisions of freedom of
speech or of the press nor of the freedom of access to information."
The Resolution went on to state, thus:
The nature of diplomacy requires centralization of authority and
expedition of decision which are inherent in executive
action. Another essential characteristic of diplomacy is its
confidential nature. Although much has been said about "open" and
"secret" diplomacy, with disparagement of the latter, Secretaries of State
Hughes and Stimson have clearly analyzed and justified the practice. In
the words of Mr. Stimson:
"A complicated negotiation . . . cannot be carried through without
many, many private talks and discussion, man to man; many
tentative suggestions and proposals. Delegates from other
countries come and tell you in confidence of their troubles at home
and of their differences with other countries and with other
delegates; they tell you of what they would do under certain
circumstances and would not do under other circumstances. . . If
these reports . . . should become public . . . who would ever
trust American Delegations in another conference? (United States
Department of State, Press Releases, June 7, 1930, pp. 282-284.)."
xxxx
There is frequent criticism of the secrecy in which negotiation with
foreign powers on nearly all subjects is concerned. This, it is
claimed, is incompatible with the substance of democracy. As
expressed by one writer, "It can be said that there is no more rigid system
of silence anywhere in the world." (E.J. Young, Looking Behind the
Censorship, J. B. Lippincott Co., 1938) President Wilson in starting his
efforts for the conclusion of the World War declared that we must have
"open covenants, openly arrived at." He quickly abandoned his thought.
No one who has studied the question believes that such a method of
publicity is possible. In the moment that negotiations are started,
pressure groups attempt to "muscle in." An ill-timed speech by one
of the parties or a frank declaration of the concession which are
exacted or offered on both sides would quickly lead to widespread
propaganda to block the negotiations. After a treaty has been
drafted and its terms are fully published, there is ample opportunity
for discussion before it is approved. (The New American Government
and Its Works, James T. Young, 4th Edition, p. 194) (Emphasis and
underscoring supplied)
Still in PMPF v. Manglapus, the Court adopted the doctrine in U.S. v.
Curtiss-Wright Export Corp.26 that the President is the sole organ of the
nation in its negotiations with foreign countries, viz:
"x x x In this vast external realm, with its important, complicated, delicate
and manifold problems, the President alone has the power to speak or
listen as a representative of the nation. He makes treaties with the advice
and consent of the Senate; but he alone negotiates. Into the field of
negotiation the Senate cannot intrude; and Congress itself is powerless
to invade it. As Marshall said in his great argument of March 7, 1800, in
the House of Representatives, "The President is the sole organ of the
nation in its external relations, and its sole representative with
foreign nations." Annals, 6th Cong., col. 613. . . (Emphasis supplied;
underscoring in the original)
Applying the principles adopted in PMPF v. Manglapus, it is clear that
while the final text of the JPEPA may not be kept perpetually confidential
– since there should be "ample opportunity for discussion before [a
treaty] is approved" – the offers exchanged by the parties during the
negotiations continue to be privileged even after the JPEPA is published.
It is reasonable to conclude that the Japanese representatives submitted
their offers with the understanding that "historic confidentiality"27 would
govern the same. Disclosing these offers could impair the ability of the
Philippines to deal not only with Japan but with other foreign
governments in future negotiations.
A ruling that Philippine offers in treaty negotiations should now be open
to public scrutiny would discourage future Philippine representatives from
frankly expressing their views during negotiations. While, on first
impression, it appears wise to deter Philippine representatives from
entering into compromises, it bears noting that treaty negotiations, or any
negotiation for that matter, normally involve a process of quid pro quo,
and oftentimes negotiators have to be willing to grant concessions
in an area of lesser importance in order to obtain more favorable
terms in an area of greater national interest. Apropos are the following
observations of Benjamin S. Duval, Jr.:
x x x [T]hose involved in the practice of negotiations appear to be in
agreement that publicity leads to "grandstanding," tends to freeze
negotiating positions, and inhibits the give-and-take essential to
successful negotiation. As Sissela Bok points out, if "negotiators have
more to gain from being approved by their own sides than by making a
reasoned agreement with competitors or adversaries, then they are
inclined to 'play to the gallery . . .'' In fact, the public reaction may leave
them little option. It would be a brave, or foolish, Arab leader who
expressed publicly a willingness for peace with Israel that did not involve
the return of the entire West Bank, or Israeli leader who stated publicly a
willingness to remove Israel's existing settlements from Judea and
Samaria in return for peace.28 (Emphasis supplied)
Indeed, by hampering the ability of our representatives to compromise,
we may be jeopardizing higher national goals for the sake of securing
less critical ones.
Diplomatic negotiations, therefore, are recognized as privileged in this
jurisdiction, the JPEPA negotiations constituting no exception. It bears
emphasis, however, that such privilege is only presumptive. For
as Senate v. Ermita holds, recognizing a type of information as privileged
does not mean that it will be considered privileged in all instances. Only
after a consideration of the context in which the claim is made may it be
determined if there is a public interest that calls for the disclosure of the
desired information, strong enough to overcome its traditionally privileged
status.
Whether petitioners have established the presence of such a public
interest shall be discussed later. For now, the Court shall first pass upon
the arguments raised by petitioners against the application of PMPF v.
Manglapus to the present case.
Arguments proffered by petitioners against the application of PMPF
v. Manglapus
Petitioners argue that PMPF v. Manglapus cannot be applied in toto to
the present case, there being substantial factual distinctions between the
two.
To petitioners, the first and most fundamental distinction lies in the nature
of the treaty involved. They stress that PMPF v. Manglapus involved the
Military Bases Agreement which necessarily pertained to matters
affecting national security; whereas the present case involves an
economic treaty that seeks to regulate trade and commerce between the
Philippines and Japan, matters which, unlike those covered by the
Military Bases Agreement, are not so vital to national security to disallow
their disclosure.
Petitioners’ argument betrays a faulty assumption that information, to be
considered privileged, must involve national security. The recognition
in Senate v. Ermita29 that executive privilege has encompassed claims of
varying kinds, such that it may even be more accurate to speak of
"executive privileges," cautions against such generalization.
While there certainly are privileges grounded on the necessity of
safeguarding national security such as those involving military secrets,
not all are founded thereon. One example is the "informer’s privilege," or
the privilege of the Government not to disclose the identity of a person or
persons who furnish information of violations of law to officers charged
with the enforcement of that law.30 The suspect involved need not be so
notorious as to be a threat to national security for this privilege to apply in
any given instance. Otherwise, the privilege would be inapplicable in all
but the most high-profile cases, in which case not only would this be
contrary to long-standing practice. It would also be highly prejudicial to
law enforcement efforts in general.
Also illustrative is the privilege accorded to presidential communications,
which are presumed privileged without distinguishing between those
which involve matters of national security and those which do not, the
rationale for the privilege being that
x x x [a] frank exchange of exploratory ideas and assessments, free
from the glare of publicity and pressure by interested parties, is essential
to protect the independence of decision-making of those tasked to
exercise Presidential, Legislative and Judicial power. x x x31 (Emphasis
supplied)
In the same way that the privilege for judicial deliberations does not
depend on the nature of the case deliberated upon, so presidential
communications are privileged whether they involve matters of national
security.
It bears emphasis, however, that the privilege accorded to presidential
communications is not absolute, one significant qualification being that
"the Executive cannot, any more than the other branches of government,
invoke a general confidentiality privilege to shield its officials and
employees from investigations by the proper governmental institutions
into possible criminal wrongdoing." 32 This qualification applies whether
the privilege is being invoked in the context of a judicial trial or a
congressional investigation conducted in aid of legislation.33
Closely related to the "presidential communications" privilege is the
deliberative process privilege recognized in the United States. As
discussed by the U.S. Supreme Court in NLRB v. Sears, Roebuck &
Co,34 deliberative process covers documents reflecting advisory opinions,
recommendations and deliberations comprising part of a process by
which governmental decisions and policies are formulated. Notably, the
privileged status of such documents rests, not on the need to protect
national security but, on the "obvious realization that officials will not
communicate candidly among themselves if each remark is a potential
item of discovery and front page news," the objective of the privilege
being to enhance the quality of agency
decisionshttp://web2.westlaw.com/find/default.wl?rs=WLW7.07&serialnu
m=1975129772&fn=_top&sv=Split&tc=-1&findtype=Y&tf=-
1&db=708&utid=%7b532A6DBF-9B4C-4A5A-8F16-
C20D9BAA36C4%7d&vr=2.0&rp=%2ffind%2fdefault.wl&mt=WLIGeneral
Subscription. 35
The diplomatic negotiations privilege bears a close resemblance to the
deliberative process and presidential communications privilege. It may be
readily perceived that the rationale for the confidential character of
diplomatic negotiations, deliberative process, and presidential
communications is similar, if not identical.
The earlier discussion on PMPF v. Manglapus36 shows that the privilege
for diplomatic negotiations is meant to encourage a frank exchange of
exploratory ideas between the negotiating parties by shielding such
negotiations from public view. Similar to the privilege for presidential
communications, the diplomatic negotiations privilege seeks, through the
same means, to protect the independence in decision-making of the
President, particularly in its capacity as "the sole organ of the nation in its
external relations, and its sole representative with foreign nations." And,
as with the deliberative process privilege, the privilege accorded to
diplomatic negotiations arises, not on account of the content of the
information per se, but because the information is part of a process of
deliberation which, in pursuit of the public interest, must be presumed
confidential.
The decision of the U.S. District Court, District of Columbia in Fulbright &
Jaworski v. Department of the Treasury 37 enlightens on the close relation
between diplomatic negotiations and deliberative process privileges. The
plaintiffs in that case sought access to notes taken by a member of the
U.S. negotiating team during the U.S.-French tax treaty negotiations.
Among the points noted therein were the issues to be discussed,
positions which the French and U.S. teams took on some points, the draft
language agreed on, and articles which needed to be amended.
Upholding the confidentiality of those notes, Judge Green ruled, thus:
Negotiations between two countries to draft a treaty represent a true
example of a deliberative process. Much give-and-take must occur
for the countries to reach an accord. A description of the negotiations
at any one point would not provide an onlooker a summary of the
discussions which could later be relied on as law. It would not be
"working law" as the points discussed and positions agreed on would be
subject to change at any date until the treaty was signed by the President
and ratified by the Senate.
The policies behind the deliberative process privilege support non-
disclosure. Much harm could accrue to the negotiations process if
these notes were revealed. Exposure of the pre-agreement positions
of the French negotiators might well offend foreign
governments and would lead to less candor by the U. S. in
recording the events of the negotiations process. As several months
pass in between negotiations, this lack of record could hinder readily the
U. S. negotiating team. Further disclosure would reveal prematurely
adopted policies. If these policies should be changed, public confusion
would result easily.
Finally, releasing these snapshot views of the negotiations would be
comparable to releasing drafts of the treaty, particularly when the
notes state the tentative provisions and language agreed on. As
drafts of regulations typically are protected by the deliberative
process privilege, Arthur Andersen & Co. v. Internal Revenue Service,
C.A. No. 80-705 (D.C.Cir., May 21, 1982), drafts of treaties should be
accorded the same protection. (Emphasis and underscoring supplied)
Clearly, the privilege accorded to diplomatic negotiations follows as a
logical consequence from the privileged character of the deliberative
process.
The Court is not unaware that in Center for International Environmental
Law (CIEL), et al. v. Office of U.S. Trade Representative38 – where the
plaintiffs sought information relating to the just-completed negotiation of a
United States-Chile Free Trade Agreement – the same district court, this
time under Judge Friedman, consciously refrained from applying the
doctrine in Fulbright and ordered the disclosure of the information being
sought.
Since the factual milieu in CIEL seemed to call for the straight application
of the doctrine in Fulbright, a discussion of why the district court did not
apply the same would help illumine this Court’s own reasons for deciding
the present case along the lines of Fulbright.
In both Fulbright and CIEL, the U.S. government cited a statutory basis
for withholding information, namely, Exemption 5 of the Freedom of
Information Act (FOIA).39 In order to qualify for protection under
Exemption 5, a document must satisfy two conditions: (1) it must be
either inter-agency or intra-agency in nature, and (2) it must be
both pre-decisional and part of the agency's deliberative or decision-
making process.40
Judge Friedman, in CIEL, himself cognizant of a "superficial similarity of
context" between the two cases, based his decision on what he
perceived to be a significant distinction: he found the negotiator’s notes
that were sought in Fulbright to be "clearly internal," whereas the
documents being sought in CIEL were those produced by or exchanged
with an outside party, i.e. Chile. The documents subject of Fulbright being
clearly internal in character, the question of disclosure therein turned not
on the threshold requirement of Exemption 5 that the document be inter-
agency, but on whether the documents were part of the agency's pre-
decisional deliberative process. On this basis, Judge Friedman found that
"Judge Green's discussion [in Fulbright] of the harm that could result from
disclosure therefore is irrelevant, since the documents at issue
[in CIEL] are not inter-agency, and the Court does not reach the
question of deliberative process." (Emphasis supplied)
In fine, Fulbright was not overturned. The court in CIEL merely found the
same to be irrelevant in light of its distinct factual setting. Whether this
conclusion was valid – a question on which this Court would not pass –
the ruling in Fulbright that "[n]egotiations between two countries to draft a
treaty represent a true example of a deliberative process" was left
standing, since the CIEL court explicitly stated that it did not reach the
question of deliberative process.
Going back to the present case, the Court recognizes that the information
sought by petitioners includes documents produced and communicated
by a party external to the Philippine government, namely, the Japanese
representatives in the JPEPA negotiations, and to that extent this case is
closer to the factual circumstances of CIEL than those of Fulbright.
Nonetheless, for reasons which shall be discussed shortly, this Court
echoes the principle articulated in Fulbright that the public policy
underlying the deliberative process privilege requires that diplomatic
negotiations should also be accorded privileged status, even if the
documents subject of the present case cannot be described as purely
internal in character.
It need not be stressed that in CIEL, the court ordered the disclosure of
information based on its finding that the first requirement of FOIA
Exemption 5 – that the documents be inter-agency – was not met. In
determining whether the government may validly refuse disclosure of the
exchanges between the U.S. and Chile, it necessarily had to deal with
this requirement, it being laid down by a statute binding on them.
In this jurisdiction, however, there is no counterpart of the FOIA, nor is
there any statutory requirement similar to FOIA Exemption 5 in particular.
Hence, Philippine courts, when assessing a claim of privilege for
diplomatic negotiations, are more free to focus directly on the issue of
whether the privilege being claimed is indeed supported by public policy,
without having to consider – as the CIEL court did – if these negotiations
fulfill a formal requirement of being "inter-agency." Important though that
requirement may be in the context of domestic negotiations, it need not
be accorded the same significance when dealing with international
negotiations.
There being a public policy supporting a privilege for diplomatic
negotiations for the reasons explained above, the Court sees no reason
to modify, much less abandon, the doctrine in PMPF v. Manglapus.
A second point petitioners proffer in their attempt to differentiate PMPF v.
Manglapus from the present case is the fact that the petitioners therein
consisted entirely of members of the mass media, while petitioners in the
present case include members of the House of Representatives who
invoke their right to information not just as citizens but as members of
Congress.
Petitioners thus conclude that the present case involves the right of
members of Congress to demand information on negotiations of
international trade agreements from the Executive branch, a matter which
was not raised in PMPF v. Manglapus.
While indeed the petitioners in PMPF v. Manglapus consisted only of
members of the mass media, it would be incorrect to claim that the
doctrine laid down therein has no bearing on a controversy such as the
present, where the demand for information has come from members of
Congress, not only from private citizens.
The privileged character accorded to diplomatic negotiations does
not ipso facto lose all force and effect simply because the same
privilege is now being claimed under different circumstances.
The probability of the claim succeeding in the new context might differ,
but to say that the privilege, as such, has no validity at all in that context
is another matter altogether.
The Court’s statement in Senate v. Ermita that "presidential refusals to
furnish information may be actuated by any of at least three distinct kinds
of considerations [state secrets privilege, informer’s privilege, and a
generic privilege for internal deliberations], and may be asserted, with
differing degrees of success, in the context of either judicial or
legislative investigations,"41 implies that a privilege, once recognized, may
be invoked under different procedural settings. That this principle holds
true particularly with respect to diplomatic negotiations may be inferred
from PMPF v. Manglapus itself, where the Court held that it is the
President alone who negotiates treaties, and not even the Senate or the
House of Representatives, unless asked, may intrude upon that process.
Clearly, the privilege for diplomatic negotiations may be invoked not only
against citizens’ demands for information, but also in the context of
legislative investigations.
Hence, the recognition granted in PMPF v. Manglapus to the privileged
character of diplomatic negotiations cannot be considered irrelevant in
resolving the present case, the contextual differences between the two
cases notwithstanding.
As third and last point raised against the application of PMPF v.
Manglapus in this case, petitioners proffer that "the socio-political and
historical contexts of the two cases are worlds apart." They claim that the
constitutional traditions and concepts prevailing at the time PMPF v.
Manglapus came about, particularly the school of thought that the
requirements of foreign policy and the ideals of transparency were
incompatible with each other or the "incompatibility hypothesis," while
valid when international relations were still governed by power, politics
and wars, are no longer so in this age of international cooperation. 42
Without delving into petitioners’ assertions respecting the "incompatibility
hypothesis," the Court notes that the ruling in PMPF v. Manglapus is
grounded more on the nature of treaty negotiations as such than on a
particular socio-political school of thought. If petitioners are suggesting
that the nature of treaty negotiations have so changed that "[a]n ill-timed
speech by one of the parties or a frank declaration of the concession
which are exacted or offered on both sides" no longer "lead[s] to
widespread propaganda to block the negotiations," or that parties in
treaty negotiations no longer expect their communications to be governed
by historic confidentiality, the burden is on them to substantiate the same.
This petitioners failed to discharge.
Whether the privilege applies only at certain stages of the
negotiation process
Petitioners admit that "diplomatic negotiations on the JPEPA are entitled
to a reasonable amount of confidentiality so as not to jeopardize the
diplomatic process." They argue, however, that the same is privileged
"only at certain stages of the negotiating process, after which such
information must necessarily be revealed to the public." 43 They add that
the duty to disclose this information was vested in the government when
the negotiations moved from the formulation and exploratory stage to the
firming up of definite propositions or official recommendations,
citing Chavez v. PCGG44 and Chavez v. PEA.45
The following statement in Chavez v. PEA, however, suffices to show that
the doctrine in both that case and Chavez v. PCGG with regard to the
duty to disclose "definite propositions of the government" does not apply
to diplomatic negotiations:
We rule, therefore, that the constitutional right to information includes
official information on on-going negotiations before a final contract. The
information, however, must constitute definite propositions by the
government and should not cover recognized exceptions like
privileged information, military and diplomatic secrets and similar
matters affecting national security and public order. x x
x46 (Emphasis and underscoring supplied)
It follows from this ruling that even definite propositions of the
government may not be disclosed if they fall under "recognized
exceptions." The privilege for diplomatic negotiations is clearly among the
recognized exceptions, for the footnote to the immediately quoted ruling
cites PMPF v. Manglapus itself as an authority.
Whether there is sufficient public interest to overcome the claim of
privilege
It being established that diplomatic negotiations enjoy a presumptive
privilege against disclosure, even against the demands of members of
Congress for information, the Court shall now determine whether
petitioners have shown the existence of a public interest sufficient to
overcome the privilege in this instance.
To clarify, there are at least two kinds of public interest that must be
taken into account. One is the presumed public interest in favor of
keeping the subject information confidential, which is the reason for
the privilege in the first place, and the other is the public interest in favor
of disclosure, the existence of which must be shown by the party asking
for information. 47
The criteria to be employed in determining whether there is a sufficient
public interest in favor of disclosure may be gathered from cases such
as U.S. v. Nixon,48 Senate Select Committee on Presidential Campaign
Activities v. Nixon,49 and In re Sealed Case.50
U.S. v. Nixon, which involved a claim of the presidential communications
privilege against the subpoena duces tecum of a district court in a
criminal case, emphasized the need to balance such claim of privilege
against the constitutional duty of courts to ensure a fair administration of
criminal justice.
x x x the allowance of the privilege to withhold evidence that is
demonstrably relevant in a criminal trial would cut deeply into the
guarantee of due process of law and gravely impair the basic
function of the courts. A President’s acknowledged need for
confidentiality in the communications of his office is general in
nature, whereas the constitutional need for production of relevant
evidence in a criminal proceeding is specific and central to the fair
adjudication of a particular criminal case in the administration of
justice. Without access to specific facts a criminal prosecution may be
totally frustrated. The President’s broad interest in confidentiality of
communications will not be vitiated by disclosure of a limited number of
conversations preliminarily shown to have some bearing on the pending
criminal cases. (Emphasis, italics and underscoring supplied)
Similarly, Senate Select Committee v. Nixon,51 which involved a claim of
the presidential communications privilege against the subpoena duces
tecum of a Senate committee, spoke of the need to balance such claim
with the duty of Congress to perform its legislative functions.
The staged decisional structure established in Nixon v. Sirica was
designed to ensure that the President and those upon whom he directly
relies in the performance of his duties could continue to work under a
general assurance that their deliberations would remain confidential. So
long as the presumption that the public interest favors
confidentiality can be defeated only by a strong showing of need by
another institution of government- a showing that the
responsibilities of that institution cannot responsibly be fulfilled
without access to records of the President's deliberations- we
believed in Nixon v. Sirica, and continue to believe, that the effective
functioning of the presidential office will not be impaired. x x x
xxxx
The sufficiency of the Committee's showing of need has come to
depend, therefore, entirely on whether the subpoenaed materials
are critical to the performance of its legislative functions. x x x
(Emphasis and underscoring supplied)
In re Sealed Case52 involved a claim of the deliberative process and
presidential communications privileges against a subpoena duces
tecum of a grand jury. On the claim of deliberative process privilege, the
court stated:
The deliberative process privilege is a qualified privilege and can be
overcome by a sufficient showing of need. This need determination
is to be made flexibly on a case-by-case, ad hoc basis. "[E]ach time
[the deliberative process privilege] is asserted the district court must
undertake a fresh balancing of the competing interests," taking into
account factors such as "the relevance of the evidence," "the
availability of other evidence," "the seriousness of the litigation,"
"the role of the government," and the "possibility of future timidity
by government employees. x x x (Emphasis, italics and underscoring
supplied)
Petitioners have failed to present the strong and "sufficient showing of
need" referred to in the immediately cited cases. The arguments they
proffer to establish their entitlement to the subject documents fall short of
this standard.
Petitioners go on to assert that the non-involvement of the Filipino people
in the JPEPA negotiation process effectively results in the bargaining
away of their economic and property rights without their knowledge and
participation, in violation of the due process clause of the Constitution.
They claim, moreover, that it is essential for the people to have access to
the initial offers exchanged during the negotiations since only through
such disclosure can their constitutional right to effectively participate in
decision-making be brought to life in the context of international trade
agreements.
Whether it can accurately be said that the Filipino people were not
involved in the JPEPA negotiations is a question of fact which this Court
need not resolve. Suffice it to state that respondents had presented
documents purporting to show that public consultations were conducted
on the JPEPA. Parenthetically, petitioners consider these "alleged
consultations" as "woefully selective and inadequate." 53
AT ALL EVENTS, since it is not disputed that the offers exchanged by
the Philippine and Japanese representatives have not been disclosed to
the public, the Court shall pass upon the issue of whether access to the
documents bearing on them is, as petitioners claim, essential to their
right to participate in decision-making.
The case for petitioners has, of course, been immensely weakened by
the disclosure of the full text of the JPEPA to the public since September
11, 2006, even as it is still being deliberated upon by the Senate and,
therefore, not yet binding on the Philippines. Were the Senate to concur
with the validity of the JPEPA at this moment, there has already been, in
the words of PMPF v. Manglapus, "ample opportunity for discussion
before [the treaty] is approved."
The text of the JPEPA having been published, petitioners have failed to
convince this Court that they will not be able to meaningfully exercise
their right to participate in decision-making unless the initial offers are
also published.
It is of public knowledge that various non-government sectors and private
citizens have already publicly expressed their views on the JPEPA, their
comments not being limited to general observations thereon but on its
specific provisions. Numerous articles and statements critical of the
JPEPA have been posted on the Internet. 54 Given these developments,
there is no basis for petitioners’ claim that access to the Philippine and
Japanese offers is essential to the exercise of their right to participate in
decision-making.
Petitioner-members of the House of Representatives additionally anchor
their claim to have a right to the subject documents on the basis of
Congress’ inherent power to regulate commerce, be it domestic or
international. They allege that Congress cannot meaningfully exercise the
power to regulate international trade agreements such as the JPEPA
without being given copies of the initial offers exchanged during the
negotiations thereof. In the same vein, they argue that the President
cannot exclude Congress from the JPEPA negotiations since whatever
power and authority the President has to negotiate international trade
agreements is derived only by delegation of Congress, pursuant to Article
VI, Section 28(2) of the Constitution and Sections 401 and 402 of
Presidential Decree No. 1464.55
The subject of Article VI Section 28(2) of the Constitution is not the power
to negotiate treaties and international agreements, but the power to fix
tariff rates, import and export quotas, and other taxes. Thus it provides:
(2) The Congress may, by law, authorize the President to fix within
specified limits, and subject to such limitations and restrictions as it may
impose, tariff rates, import and export quotas, tonnage and wharfage
dues, and other duties or imposts within the framework of the national
development program of the Government.
As to the power to negotiate treaties, the constitutional basis thereof is
Section 21 of Article VII – the article on the Executive Department –
which states:
No treaty or international agreement shall be valid and effective unless
concurred in by at least two-thirds of all the Members of the Senate.
The doctrine in PMPF v. Manglapus that the treaty-making power is
exclusive to the President, being the sole organ of the nation in its
external relations, was echoed in BAYAN v. Executive Secretary56 where
the Court held:
By constitutional fiat and by the intrinsic nature of his office, the
President, as head of State, is the sole organ and authority in the
external affairs of the country. In many ways, the President is the chief
architect of the nation's foreign policy; his "dominance in the field of
foreign relations is (then) conceded." Wielding vast powers and influence,
his conduct in the external affairs of the nation, as Jefferson describes, is
"executive altogether."
As regards the power to enter into treaties or international
agreements, the Constitution vests the same in the
President, subject only to the concurrence of at least two thirds vote
of all the members of the Senate. In this light, the negotiation of the
VFA and the subsequent ratification of the agreement are exclusive acts
which pertain solely to the President, in the lawful exercise of his vast
executive and diplomatic powers granted him no less than by the
fundamental law itself. Into the field of negotiation the Senate
cannot intrude, and Congress itself is powerless to invade it. x x
x (Italics in the original; emphasis and underscoring supplied)
The same doctrine was reiterated even more recently in Pimentel v.
Executive Secretary57 where the Court ruled:
In our system of government, the President, being the head of state, is
regarded as the sole organ and authority in external relations and is
the country's sole representative with foreign nations. As the chief
architect of foreign policy, the President acts as the country's mouthpiece
with respect to international affairs. Hence, the President is vested with
the authority to deal with foreign states and governments, extend or
withhold recognition, maintain diplomatic relations, enter into treaties,
and otherwise transact the business of foreign relations. In the realm of
treaty-making, the President has the sole authority to negotiate with
other states.
Nonetheless, while the President has the sole authority to negotiate
and enter into treaties, the Constitution provides a limitation to his
power by requiring the concurrence of 2/3 of all the members of the
Senate for the validity of the treaty entered into by him. x x x
(Emphasis and underscoring supplied)
While the power then to fix tariff rates and other taxes clearly belongs to
Congress, and is exercised by the President only by delegation of that
body, it has long been recognized that the power to enter into treaties is
vested directly and exclusively in the President, subject only to the
concurrence of at least two-thirds of all the Members of the Senate for
the validity of the treaty. In this light, the authority of the President to
enter into trade agreements with foreign nations provided under P.D.
146458 may be interpreted as an acknowledgment of a power already
inherent in its office. It may not be used as basis to hold the President or
its representatives accountable to Congress for the conduct of treaty
negotiations.
This is not to say, of course, that the President’s power to enter into
treaties is unlimited but for the requirement of Senate concurrence, since
the President must still ensure that all treaties will substantively conform
to all the relevant provisions of the Constitution.
It follows from the above discussion that Congress, while possessing vast
legislative powers, may not interfere in the field of treaty negotiations.
While Article VII, Section 21 provides for Senate concurrence, such
pertains only to the validity of the treaty under consideration, not to the
conduct of negotiations attendant to its conclusion. Moreover, it is not
even Congress as a whole that has been given the authority to concur as
a means of checking the treaty-making power of the President, but only
the Senate.
Thus, as in the case of petitioners suing in their capacity as private
citizens, petitioners-members of the House of Representatives fail to
present a "sufficient showing of need" that the information sought is
critical to the performance of the functions of Congress, functions that do
not include treaty-negotiation.
Respondents’ alleged failure to timely claim executive privilege
On respondents’ invocation of executive privilege, petitioners find the
same defective, not having been done seasonably as it was raised only
in their Comment to the present petition and not during the House
Committee hearings.
That respondents invoked the privilege for the first time only in their
Comment to the present petition does not mean that the claim of privilege
should not be credited. Petitioners’ position presupposes that an
assertion of the privilege should have been made during the House
Committee investigations, failing which respondents are deemed to have
waived it.
When the House Committee and petitioner-Congressman
Aguja requested respondents for copies of the documents subject of this
case, respondents replied that the negotiations were still on-going and
that the draft of the JPEPA would be released once the text thereof is
settled and complete. There was no intimation that the requested copies
are confidential in nature by reason of public policy. The response may
not thus be deemed a claim of privilege by the standards of Senate v.
Ermita, which recognizes as claims of privilege only those which are
accompanied by precise and certain reasons for preserving
the confidentiality of the information being sought.
Respondents’ failure to claim the privilege during the House Committee
hearings may not, however, be construed as a waiver thereof by the
Executive branch. As the immediately preceding paragraph indicates,
what respondents received from the House Committee and petitioner-
Congressman Aguja were mere requests for information. And as priorly
stated, the House Committee itself refrained from pursuing its earlier
resolution to issue a subpoena duces tecum on account of then Speaker
Jose de Venecia’s alleged request to Committee Chairperson
Congressman Teves to hold the same in abeyance.
While it is a salutary and noble practice for Congress to refrain from
issuing subpoenas to executive officials – out of respect for their office –
until resort to it becomes necessary, the fact remains that such requests
are not a compulsory process. Being mere requests, they do not strictly
call for an assertion of executive privilege.
The privilege is an exemption to Congress’ power of inquiry.59 So long as
Congress itself finds no cause to enforce such power, there is no strict
necessity to assert the privilege. In this light, respondents’ failure to
invoke the privilege during the House Committee investigations did not
amount to a waiver thereof.
The Court observes, however, that the claim of privilege appearing in
respondents’ Comment to this petition fails to satisfy in full the
requirement laid down in Senate v. Ermita that the claim should be
invoked by the President or through the Executive Secretary "by order of
the President."60 Respondents’ claim of privilege is being sustained,
however, its flaw notwithstanding, because of circumstances peculiar to
the case.
The assertion of executive privilege by the Executive Secretary, who is
one of the respondents herein, without him adding the phrase "by order
of the President," shall be considered as partially complying with the
requirement laid down in Senate v. Ermita. The requirement that the
phrase "by order of the President" should accompany the Executive
Secretary’s claim of privilege is a new rule laid down for the first time
in Senate v. Ermita, which was not yet final and executory at the time
respondents filed their Comment to the petition. 61 A strict application of
this requirement would thus be unwarranted in this case.
Response to the Dissenting Opinion of the Chief Justice
We are aware that behind the dissent of the Chief Justice lies a genuine
zeal to protect our people’s right to information against any abuse of
executive privilege. It is a zeal that We fully share.
The Court, however, in its endeavor to guard against the abuse of
executive privilege, should be careful not to veer towards the opposite
extreme, to the point that it would strike down as invalid even a legitimate
exercise thereof.
We respond only to the salient arguments of the Dissenting Opinion
which have not yet been sufficiently addressed above.
1. After its historical discussion on the allocation of power over
international trade agreements in the United States, the dissent
concludes that "it will be turning somersaults with history to contend that
the President is the sole organ for external relations" in that jurisdiction.
With regard to this opinion, We make only the following observations:
There is, at least, a core meaning of the phrase "sole organ of the nation
in its external relations" which is not being disputed, namely, that the
power to directly negotiate treaties and international agreements is
vested by our Constitution only in the Executive. Thus, the dissent states
that "Congress has the power to regulate commerce with foreign
nations but does not have the power to negotiate international
agreements directly."62
What is disputed is how this principle applies to the case at bar.
The dissent opines that petitioner-members of the House of
Representatives, by asking for the subject JPEPA documents, are not
seeking to directly participate in the negotiations of the JPEPA, hence,
they cannot be prevented from gaining access to these documents.
On the other hand, We hold that this is one occasion where the following
ruling in Agan v. PIATCO63 – and in other cases both before and since –
should be applied:
This Court has long and consistently adhered to the legal maxim
that those that cannot be done directly cannot be done indirectly. To
declare the PIATCO contracts valid despite the clear statutory prohibition
against a direct government guarantee would not only make a mockery of
what the BOT Law seeks to prevent -- which is to expose the government
to the risk of incurring a monetary obligation resulting from a contract of
loan between the project proponent and its lenders and to which the
Government is not a party to -- but would also render the BOT Law
useless for what it seeks to achieve –- to make use of the resources of
the private sector in the "financing, operation and maintenance of
infrastructure and development projects" which are necessary for national
growth and development but which the government, unfortunately, could
ill-afford to finance at this point in time.64
Similarly, while herein petitioners-members of the House of
Representatives may not have been aiming to participate in the
negotiations directly, opening the JPEPA negotiations to their scrutiny –
even to the point of giving them access to the offers exchanged between
the Japanese and Philippine delegations – would have made a mockery
of what the Constitution sought to prevent and rendered it useless for
what it sought to achieve when it vested the power of direct negotiation
solely with the President.
What the U.S. Constitution sought to prevent and aimed to achieve in
defining the treaty-making power of the President, which our Constitution
similarly defines, may be gathered from Hamilton’s explanation of why
the U.S. Constitution excludes the House of Representatives from the
treaty-making process:
x x x The fluctuating, and taking its future increase into account, the
multitudinous composition of that body, forbid us to expect in it those
qualities which are essential to the proper execution of such a trust.
Accurate and comprehensive knowledge of foreign politics; a steady and
systematic adherence to the same views; a nice and uniform sensibility to
national character, decision, secrecy and dispatch; are incompatible
with a body so variable and so numerous. The very complication of the
business by introducing a necessity of the concurrence of so many
different bodies, would of itself afford a solid objection. The greater
frequency of the calls upon the house of representatives, and the greater
length of time which it would often be necessary to keep them together
when convened, to obtain their sanction in the progressive stages of a
treaty, would be source of so great inconvenience and expense, as alone
ought to condemn the project.65
These considerations a fortiori apply in this jurisdiction, since the
Philippine Constitution, unlike that of the U.S., does not even grant the
Senate the power to advise the Executive in the making of treaties, but
only vests in that body the power to concur in the validity of the treaty
after negotiations have been concluded. 66 Much less, therefore, should it
be inferred that the House of Representatives has this power.
Since allowing petitioner-members of the House of Representatives
access to the subject JPEPA documents would set a precedent for future
negotiations, leading to the contravention of the public interests
articulated above which the Constitution sought to protect, the subject
documents should not be disclosed.
2. The dissent also asserts that respondents can no longer claim the
diplomatic secrets privilege over the subject JPEPA documents now that
negotiations have been concluded, since their reasons for nondisclosure
cited in the June 23, 2005 letter of Sec. Ermita, and later in their
Comment, necessarily apply only for as long as the negotiations were still
pending;
In their Comment, respondents contend that "the negotiations of the
representatives of the Philippines as well as of Japan must be allowed to
explore alternatives in the course of the negotiations in the same manner
as judicial deliberations and working drafts of opinions are accorded strict
confidentiality." That respondents liken the documents involved in
the JPEPA negotiations to judicial deliberations and working drafts
of opinions evinces, by itself, that they were claiming confidentiality
not only until, but even after, the conclusion of the negotiations.
Judicial deliberations do not lose their confidential character once a
decision has been promulgated by the courts. The same holds true with
respect to working drafts of opinions, which are comparable to intra-
agency recommendations. Such intra-agency recommendations are
privileged even after the position under consideration by the agency has
developed into a definite proposition, hence, the rule in this jurisdiction
that agencies have the duty to disclose only definite propositions, and not
the inter-agency and intra-agency communications during the stage when
common assertions are still being formulated. 67
3. The dissent claims that petitioner-members of the House of
Representatives have sufficiently shown their need for the same
documents to overcome the privilege. Again, We disagree.
The House Committee that initiated the investigations on the JPEPA did
not pursue its earlier intention to subpoena the documents. This strongly
undermines the assertion that access to the same documents by the
House Committee is critical to the performance of its legislative functions.
If the documents were indeed critical, the House Committee should have,
at the very least, issued a subpoena duces tecum or, like what the
Senate did in Senate v. Ermita, filed the present petition as a legislative
body, rather than leaving it to the discretion of individual Congressmen
whether to pursue an action or not. Such acts would have served as
strong indicia that Congress itself finds the subject information to be
critical to its legislative functions.
Further, given that respondents have claimed executive privilege,
petitioner-members of the House of Representatives should have, at
least, shown how its lack of access to the Philippine and Japanese offers
would hinder the intelligent crafting of legislation. Mere assertion that the
JPEPA covers a subject matter over which Congress has the power to
legislate would not suffice. As Senate Select Committee v. Nixon68 held,
the showing required to overcome the presumption favoring
confidentiality turns, not only on the nature and appropriateness of the
function in the performance of which the material was sought, but also
the degree to which the material was necessary to its fulfillment. This
petitioners failed to do.
Furthermore, from the time the final text of the JPEPA including its
annexes and attachments was published, petitioner-members of the
House of Representatives have been free to use it for any legislative
purpose they may see fit. Since such publication, petitioners’ need, if
any, specifically for the Philippine and Japanese offers leading to the final
version of the JPEPA, has become even less apparent.
In asserting that the balance in this instance tilts in favor of disclosing the
JPEPA documents, the dissent contends that the Executive has failed to
show how disclosing them after the conclusion of negotiations would
impair the performance of its functions. The contention, with due respect,
misplaces the onus probandi. While, in keeping with the general
presumption of transparency, the burden is initially on the Executive to
provide precise and certain reasons for upholding its claim of privilege,
once the Executive is able to show that the documents being sought are
covered by a recognized privilege, the burden shifts to the party seeking
information to overcome the privilege by a strong showing of need.
When it was thus established that the JPEPA documents are covered by
the privilege for diplomatic negotiations pursuant to PMPF v. Manglapus,
the presumption arose that their disclosure would impair the performance
of executive functions. It was then incumbent on petitioner- requesting
parties to show that they have a strong need for the information sufficient
to overcome the privilege. They have not, however.
4. Respecting the failure of the Executive Secretary to explicitly state that
he is claiming the privilege "by order of the President," the same may not
be strictly applied to the privilege claim subject of this case.
When the Court in Senate v. Ermita limited the power of invoking the
privilege to the President alone, it was laying down a new rule for which
there is no counterpart even in the United States from which the concept
of executive privilege was adopted. As held in the 2004 case of Judicial
Watch, Inc. v. Department of Justice,69 citing In re Sealed Case,70 "the
issue of whether a President must personally invoke the [presidential
communications] privilege remains an open question." U.S. v.
Reynolds,71 on the other hand, held that "[t]here must be a formal claim of
privilege, lodged by the head of the department which has control over
the matter, after actual personal consideration by that officer."
The rule was thus laid down by this Court, not in adherence to any
established precedent, but with the aim of preventing the abuse of the
privilege in light of its highly exceptional nature. The Court’s recognition
that the Executive Secretary also bears the power to invoke the privilege,
provided he does so "by order of the President," is meant to avoid laying
down too rigid a rule, the Court being aware that it was laying down a
new restriction on executive privilege. It is with the same spirit that the
Court should not be overly strict with applying the same rule in this
peculiar instance, where the claim of executive privilege occurred before
the judgment in Senate v. Ermita became final.
5. To show that PMPF v. Manglapus may not be applied in the present
case, the dissent implies that the Court therein erred in citing US v.
Curtiss Wright72 and the book entitled The New American Government
and Its Work73 since these authorities, so the dissent claims, may not be
used to calibrate the importance of the right to information in the
Philippine setting.
The dissent argues that since Curtiss-Wright referred to a conflict
between the executive and legislative branches of government, the
factual setting thereof was different from that of PMPF v.
Manglapus which involved a collision between governmental power over
the conduct of foreign affairs and the citizen’s right to information.
That the Court could freely cite Curtiss-Wright – a case that upholds the
secrecy of diplomatic negotiations against congressional demands for
information – in the course of laying down a ruling on the public right to
information only serves to underscore the principle mentioned earlier that
the privileged character accorded to diplomatic negotiations does
not ipso facto lose all force and effect simply because the same privilege
is now being claimed under different circumstances.
PMPF v. Manglapus indeed involved a demand for information from
private citizens and not an executive-legislative conflict, but so
did Chavez v. PEA74 which held that "the [public’s] right to information . . .
does not extend to matters recognized as privileged information under
the separation of powers." What counts as privileged information in an
executive-legislative conflict is thus also recognized as such in cases
involving the public’s right to information.
Chavez v. PCGG75 also involved the public’s right to information, yet the
Court recognized as a valid limitation to that right the same privileged
information based on separation of powers – closed-door Cabinet
meetings, executive sessions of either house of Congress, and the
internal deliberations of the Supreme Court.
These cases show that the Court has always regarded claims of
privilege, whether in the context of an executive-legislative conflict or a
citizen’s demand for information, as closely intertwined, such that the
principles applicable to one are also applicable to the other.
The reason is obvious. If the validity of claims of privilege were to be
assessed by entirely different criteria in each context, this may give rise
to the absurd result where Congress would be denied access to a
particular information because of a claim of executive privilege, but the
general public would have access to the same information, the claim of
privilege notwithstanding.
Absurdity would be the ultimate result if, for instance, the Court adopts
the "clear and present danger" test for the assessment of claims of
privilege against citizens’ demands for information. If executive
information, when demanded by a citizen, is privileged only when there is
a clear and present danger of a substantive evil that the State has a right
to prevent, it would be very difficult for the Executive to establish the
validity of its claim in each instance. In contrast, if the demand comes
from Congress, the Executive merely has to show that the information is
covered by a recognized privilege in order to shift the burden on
Congress to present a strong showing of need. This would lead to a
situation where it would be more difficult for Congress to access
executive information than it would be for private citizens.
We maintain then that when the Executive has already shown that an
information is covered by executive privilege, the party demanding the
information must present a "strong showing of need," whether that party
is Congress or a private citizen.
The rule that the same "showing of need" test applies in both these
contexts, however, should not be construed as a denial of the importance
of analyzing the context in which an executive privilege controversy may
happen to be placed. Rather, it affirms it, for it means that
the specific need being shown by the party seeking information in
every particular instance is highly significant in determining whether to
uphold a claim of privilege. This "need" is, precisely, part of the
context in light of which every claim of privilege should be
assessed.
Since, as demonstrated above, there are common principles that should
be applied to executive privilege controversies across different contexts,
the Court in PMPF v. Manglapus did not err when it cited the Curtiss-
Wright case.
The claim that the book cited in PMPF v. Manglapus entitled The New
American Government and Its Work could not have taken into account
the expanded statutory right to information in the FOIA assumes that the
observations in that book in support of the confidentiality of treaty
negotiations would be different had it been written after the FOIA. Such
assumption is, with due respect, at best, speculative.
As to the claim in the dissent that "[i]t is more doubtful if the same book
be used to calibrate the importance of the right of access to information in
the Philippine setting considering its elevation as a constitutional right,"
we submit that the elevation of such right as a constitutional right did not
set it free from the legitimate restrictions of executive privilege which is
itself constitutionally-based.76 Hence, the comments in that book which
were cited in PMPF v. Manglapus remain valid doctrine.
6. The dissent further asserts that the Court has never used "need" as a
test to uphold or allow inroads into rights guaranteed under the
Constitution. With due respect, we assert otherwise. The Court has done
so before, albeit without using the term "need."
In executive privilege controversies, the requirement that parties present
a "sufficient showing of need" only means, in substance, that they should
show a public interest in favor of disclosure sufficient in degree to
overcome the claim of privilege.77 Verily, the Court in such cases
engages in a balancing of interests. Such a balancing of interests is
certainly not new in constitutional adjudication involving fundamental
rights. Secretary of Justice v. Lantion,78 which was cited in the dissent,
applied just such a test.
Given that the dissent has clarified that it does not seek to apply the
"clear and present danger" test to the present controversy, but the
balancing test, there seems to be no substantial dispute between the
position laid down in this ponencia and that reflected in the dissent as to
what test to apply. It would appear that the only disagreement is on the
results of applying that test in this instance.
The dissent, nonetheless, maintains that "it suffices that information is of
public concern for it to be covered by the right, regardless of the public’s
need for the information," and that the same would hold true even "if they
simply want to know it because it interests them." As has been stated
earlier, however, there is no dispute that the information subject of this
case is a matter of public concern. The Court has earlier concluded that it
is a matter of public concern, not on the basis of any specific need shown
by petitioners, but from the very nature of the JPEPA as an international
trade agreement.
However, when the Executive has – as in this case – invoked the
privilege, and it has been established that the subject information is
indeed covered by the privilege being claimed, can a party overcome the
same by merely asserting that the information being demanded is a
matter of public concern, without any further showing required? Certainly
not, for that would render the doctrine of executive privilege of no force
and effect whatsoever as a limitation on the right to information, because
then the sole test in such controversies would be whether an information
is a matter of public concern.
Moreover, in view of the earlier discussions, we must bear in mind that,
by disclosing the documents of the JPEPA negotiations, the Philippine
government runs the grave risk of betraying the trust reposed in it by the
Japanese representatives, indeed, by the Japanese government itself.
How would the Philippine government then explain itself when that
happens? Surely, it cannot bear to say that it just had to release the
information because certain persons simply wanted to know it "because it
interests them."
Thus, the Court holds that, in determining whether an information is
covered by the right to information, a specific "showing of need" for such
information is not a relevant consideration, but only whether the same is
a matter of public concern. When, however, the government has claimed
executive privilege, and it has established that the information is indeed
covered by the same, then the party demanding it, if it is to overcome the
privilege, must show that that the information is vital, not simply for the
satisfaction of its curiosity, but for its ability to effectively and reasonably
participate in social, political, and economic decision-making.79
7. The dissent maintains that "[t]he treaty has thus entered the ultimate
stage where the people can exercise their right to participate in the
discussion whether the Senate should concur in its ratification or not."
(Emphasis supplied) It adds that this right "will be diluted unless the
people can have access to the subject JPEPA documents". What, to the
dissent, is a dilution of the right to participate in decision-making is, to Us,
simply a recognition of the qualified nature of the public’s right to
information. It is beyond dispute that the right to information is not
absolute and that the doctrine of executive privilege is a recognized
limitation on that right.
Moreover, contrary to the submission that the right to participate in
decision-making would be diluted, We reiterate that our people have
been exercising their right to participate in the discussion on the issue of
the JPEPA, and they have been able to articulate their different opinions
without need of access to the JPEPA negotiation documents.
Thus, we hold that the balance in this case tilts in favor of executive
privilege.
8. Against our ruling that the principles applied in U.S. v. Nixon,
the Senate Select Committee case, and In re Sealed Case, are similarly
applicable to the present controversy, the dissent cites the caveat in
the Nixon case that the U.S. Court was there addressing only the
President’s assertion of privilege in the context of a criminal trial, not a
civil litigation nor a congressional demand for information. What this
caveat means, however, is only that courts must be careful not to hastily
apply the ruling therein to other contexts. It does not, however, absolutely
mean that the principles applied in that case may never be applied in
such contexts.
Hence, U.S. courts have cited U.S. v. Nixon in support of their rulings on
claims of executive privilege in contexts other than a criminal trial, as in
the case of Nixon v. Administrator of General Services80 – which involved
former President Nixon’s invocation of executive privilege to challenge
the constitutionality of the "Presidential Recordings and Materials
Preservation Act"81 – and the above-mentioned In re Sealed Case which
involved a claim of privilege against a subpoena duces tecum issued in a
grand jury investigation.
Indeed, in applying to the present case the principles found in U.S. v.
Nixon and in the other cases already mentioned, We are merely affirming
what the Chief Justice stated in his Dissenting Opinion in Neri v. Senate
Committee on Accountability82 – a case involving an executive-legislative
conflict over executive privilege. That dissenting opinion stated that,
while Nixon was not concerned with the balance between the President’s
generalized interest in confidentiality and congressional demands for
information, "[n]onetheless the [U.S.] Court laid down principles and
procedures that can serve as torch lights to illumine us on the
scope and use of Presidential communication privilege in the case
at bar."83 While the Court was divided in Neri, this opinion of the Chief
Justice was not among the points of disagreement, and We similarly hold
now that the Nixon case is a useful guide in the proper resolution of the
present controversy, notwithstanding the difference in context.
Verily, while the Court should guard against the abuse of executive
privilege, it should also give full recognition to the validity of the
privilege whenever it is claimed within the proper bounds of
executive power, as in this case. Otherwise, the Court would
undermine its own credibility, for it would be perceived as no longer
aiming to strike a balance, but seeking merely to water down executive
privilege to the point of irrelevance.
Conclusion
To recapitulate, petitioners’ demand to be furnished with a copy of the full
text of the JPEPA has become moot and academic, it having been made
accessible to the public since September 11, 2006. As for their demand
for copies of the Philippine and Japanese offers submitted during the
JPEPA negotiations, the same must be denied, respondents’ claim of
executive privilege being valid.
Diplomatic negotiations have, since the Court promulgated its Resolution
in PMPF v. Manglapus on September 13, 1988, been recognized as
privileged in this jurisdiction and the reasons proffered by petitioners
against the application of the ruling therein to the present case have not
persuaded the Court. Moreover, petitioners – both private citizens and
members of the House of Representatives – have failed to present a
"sufficient showing of need" to overcome the claim of privilege in this
case.
That the privilege was asserted for the first time in respondents’
Comment to the present petition, and not during the hearings of the
House Special Committee on Globalization, is of no moment, since it
cannot be interpreted as a waiver of the privilege on the part of the
Executive branch.
For reasons already explained, this Decision shall not be interpreted as
departing from the ruling in Senate v. Ermita that executive privilege
should be invoked by the President or through the Executive Secretary
"by order of the President."
WHEREFORE, the petition is DISMISSED.
SO ORDERED.
CONCHITA CARPIO MORALES
Associate Justice
G.R. No. L-6266 February 2, 1953
EULOGIO RODRIGUEZ, SR., ETC., ET AL., petitioners,
vs.
VICENTE GELLA, ETC., ET AL., respondents.
Eulogio Rodriguez, Sr., Lorenzo M. Tañada, Claro M. Recto, Jose P.
Laurel, Jesus Barrera and Leon Ma. Guerrero for petitioner.
Office of the Solicitor General Juan R. Liwag and Solicitor Martiniano P.
Vivo for respondents.
PARAS, C.J.:
As a fitting foreword, it may be recalled that on a previous occasion, on
August 26, 1949 to be exact, this court had already passed upon the
status of Commonwealth Act No. 671, approved on December 16, 1941,
"declaring a state of total emergency as a result of war involving the
Philippines and authorizing the President to promulgate rules and
regulations to meet such emergency." Five members held that the Act
ceased to be operative in its totality, on May 25, 1946 (when the
Congress convened in special session) according to Chief Justice Moran.
Justice Bengzon, Padilla, Montemayor, Reyes and Torres in effect
concluded that the powers delegated to the President had been
withdrawn as to matters already legislated upon by the Congress or on
which the latter had demonstrated its readiness or ability to act.
Executive Orders No. 62 (dated June 21, 1947) regulating house and lot
rentals, No. 192 (dated December 24, 1948) regulating exports, Nos. 225
and 226 (dated June 15,1949) the first appropriation funds for the
operation of the Government from July 1, 1949 to June 30, 1950, and the
second appropriating funds for election expenses in November 1949,
were therefore declared null and void for having been issued after Act
No. 671 had lapsed and/or after the Congress had enacted legislation on
the same subjects.1
More or less the same considerations that influenced our pronouncement
of August 26, 1949 are and should be controlling in the case now before
us, wherein the petitioners seek to invalidate Executive Orders Nos. 545
and 546 issued on November 10, 1952, the first appropriating the sum of
P37,850,500 for urgent and essential public works, and the second
setting aside the sum of P11,367,600 for relief in the provinces and cities
visited by typhoons, floods, droughts, earthquakes, volcanic action and
other calamities.
Section 26 of Article VI of the Constitution provides that "in times of war
or other national emergency, the Congress may by law authorize the
President, for a limited period and subject to such restrictions as it may
prescribe, to promulgate rules and regulations to carry out a declared
national policy." Accordingly the National Assembly passed
Commonwealth Act No. 671, declaring (in section 1) the national policy
that "the existence of war between the United States and other countries
of Europe and Asia, which involves the Philippines makes it necessary to
invest the President with extraordinary powers in order to meet the
resulting emergency," and (in section 2) authorizing the President,
"during the existence of the emergency, to promulgate such rules and
regulations as he may deem necessary to carry out the national policy
declared in section 1."
As the Act was expressly in pursuance of the constitutional provision, it
has to be assumed that the National Assembly intended it to be only for a
limited period. If it be contended that the Act has not yet been duly
repealed, and such step is necessary to a cessation of the emergency
powers delegated to the President, the result would be obvious
unconstitutionality, since it may never be repealed by the Congress, or if
the latter ever attempts to do so, the President may wield his veto. This
eventuality has in fact taken place when the President disapproved
House Bill No. 727, repealing all Emergency Powers Acts. The situation
will make the Congress and the President or either as the principal
authority to determine the indefinite duration of the delegation of
legislative powers, — in palpable repugnance to the constitutional
provision that any grant thereunder must be for a limited period,
necessarily to be fixed in the law itself and not dependent upon the
arbitrary or elastic will of either the Congress or the President.
Although House Bill No. 727, had been vetoed by the President and did
not thereby become a regular statute, it may at least be considered as a
concurrent resolution of the Congress formally declaring the termination
of the emergency powers. To contend that the Bill needed presidential
acquiescence to produce effect, would lead to the anomalous, if not
absurd, situation that, "while Congress might delegate its power by a
simple majority, it might not be able to recall them except by two-third
vote. In other words, it would be easier for Congress to delegate its
powers than to take them back. This is not right and is not, and ought not
to be the law."2
Act No. 671 may be likened to an ordinary contract of agency, whereby
the consent of the agent is necessary only in the sense that he cannot be
compelled to accept the trust, in the same way that the principal cannot
be forced to keep the relation in eternity or at the will of the agent. Neither
can it be suggested that the agency created under the Act is coupled with
interest.
The logical view consistent with constitutionality is to hold that the powers
lasted only during the emergency resulting from the last world war which
factually involved the Philippines when Act No. 671 was passed on
December 16, 1941. That emergency, which naturally terminated upon
the ending of the last world war, was contemplated by the members of
the National Assembly on the foresight that the actual state of war could
prevent it from holding its next regular session. This is confirmed by the
following statement of President Quezon: "When it became evident that
we were completely helpless against air attack and that it was most
unlikely the Philippine Legislature would hold its next regular session
which was to open on January 1, 1942, the National Assembly passed
into history approving a resolution which reaffirmed the abiding faith of
the Filipino people in, and their loyalty to, the United States. The
Assembly also enacted a law granting the President of the Philippines all
the powers that under the Philippine Constitution may be delegated to
him in time of war."3 When President Quezon said "in time of war", he an
doubtedly meant such factual war as that then raging.
As early as July 26, 1948, the Congress categorically declared that "since
liberation conditions have gradually returned to normal, but not so with
regard to those who have suffered the ravages of war and who have not
received any relief for the loss and destruction resulting therefrom," and
that "the emergency created by the last war as regards these war
sufferers being still existent, it is the declared policy of the state that as to
them the debt moratorium should be continued in force in a modified
form."4 It is important to remember that Republic Act No. 342 in which this
declaration was made bore the approval of the President. Indeed, the
latter in his speech delivered on July 4, 1949, plainly proclaimed that
"what emergencies it (the Republic) faces today are incidental passing
rains artificially created by seasonal partisanship, very common among
democracies but will disappear with the rains that follow the thunderclaps
not later than November 8 of this year," — an admission, that such
emergencies not only are not total but are not the result of the last war as
envisaged in Act No. 671.
If more is necessary to demonstrate the unmistakable stand of the
legislative department on the alleged existence of emergency, reference
may be had to House Bill No. 727, hereinbefore referred to, repealing all
Emergency Powers Acts.
Moreover, section 26 of Article VI of the constitution, in virtue of which Act
No. 671 was passed, authorizes the delegation of powers by the
Congress (1) in times of war or (2) other national emergency. The
emergency expressly spoken of in the title and in section 1 of the Act is
one "in time of war," as distinguished from "other national emergency"
that may arise as an after-effect of war or from natural causes such as
widespread earthquakes, typhoons, floods, and the like. Certainly the
typhoons that hit some provinces and cities in 1952 not only did not result
from the last world war but were and could not have been contemplated
by the legislators. At any rate, the Congress is available for necessary
special sessions, and it cannot let the people down without somehow
being answerable thereover.
As a matter of fact, the President, in returning to the Congress without his
signature House Bill No. 727, did not invoke any emergency resulting
from the last world war, but only called attention to an impending
emergency that may be brought about by present complicated and
troubled world conditions, and to the fact that our own soldiers are
fighting and dying in Korea in defense of democracy and freedom and for
the preservation of our Republic. The emergency thus feared cannot,
however, be attributed to the war mentioned in Act No. 671 and fought
between Germany and Japan on one side and the Allied Powers on the
other; and indications are that in the next world war, if any, the
communist countries will be aligned against the democracies. No
departure can be made from the national policy declared in section 1 of
Act No. 671. New powers may be granted as often as emergencies
contemplated in the Constitution arise.
There is no point in the argument that the Philippines is still technically at
war with Japan pending the ratification of the peace treaty. In the first
place, Act No. 671 referred to a factual war. In the second place, the last
world war was between the United States and Japan, the Philippines
being involved only because it was then under American sovereignty. In
the third place, the United States had already signed the peace treaty
with Japan, and the Philippines has become an independent country
since July 4, 1946.
It is pointed out that the passage of House Bill No. 727 is inconsistent
with the claim that the emergency powers are non-existent. But, from the
debates in the House, it is patent that the Bill had to be approved merely
to remove all doubts, especially because this Court had heretofore failed,
for lack of necessary majority, to declare Act No. 671 entirely inoperative.
Reliance is placed on the petition of about seventy Congressmen and
Senators and on House Resolution No. 99, urging the President to
release and appropriate funds for essential and urgent public works and
for relief in the typhoon-stricken areas. It is enough to state, in reply, that
the said petition and resolution cannot prevail over the force and effect of
House Bill No. 727 formally passed by two chambers of the Congress. If
faith can be accorded to the resolution of one house, there is more
reason for accepting the solemn declarations of two houses.
Even under the theory of some members of this court that insofar as the
Congress had shown its readiness or ability to act on a given matter, the
emergency powers delegated to the President had been pro
tanto withdrawn, Executive Orders Nos. 545 and 546 must be declared
as having no legal anchorage. We can take judicial notice of the fact that
the Congress has since liberation repeatedly been approving acts
appropriating funds for the operation of the Government, public works,
and many others purposes, with the result that as to such legislative task
the Congress must be deemed to have long decided to assume the
corresponding power itself and to withdraw the same from the President.
If the President had ceased to have powers with regards to general
appropriations, none can remain in respect of special appropriations;
otherwise he may accomplish indirectly what he cannot do directly.
Besides, it is significant that Act No. 671 expressly limited the power of
the President to that continuing "in force" appropriations which would
lapse or otherwise become inoperative, so that, even assuming that the
Act is still effective, it is doubtful whether the President can by executive
orders make new appropriations. The specific power "to continue in force
laws and appropriations which would lapse or otherwise become
inoperative" is a limitation on the general power "to exercise such other
powers as he may deem necessary to enable the Government to fulfill its
responsibilities and to maintain and enforce its authority." Indeed, to hold
that although the Congress has, for about seven years since liberation,
been normally functioning and legislating on every conceivable field, the
President still has any residuary powers under the Act, would necessarily
lead to confusion and overlapping, if not conflict.
Shelter may not be sought in the proposition that the President should be
allowed to exercise emergency powers for the sake of speed and
expediency in the interest and for the welfare of the people, because we
have the Constitution, designed to establish a government under a
regime of justice, liberty and democracy. In line with such primordial
objective, our Government is democratic in form and based on the
system of separation of powers. Unless and until changed or amended,
we shall have to abide by the letter and spirit of the Constitution and be
prepared to accept the consequences resulting from or inherent in
disagreements between, inaction or even refusal of the legislative and
executive departments. Much as it is imperative in some cases to have
prompt official action, deadlocks in and slowness of democratic
processes must be preferred to concentration of powers in any one man
or group of men for obvious reasons. The framers of the Constitution,
however, had the vision of and were careful in allowing delegation of
legislative powers to the President for a limited period "in times of war or
other national emergency." They had thus entrusted to the good
judgment of the Congress the duty of coping with any national
emergency by a more efficient procedure; but it alone must decide
because emergency in itself cannot and should not create power. In our
democracy the hope and survival of the nation lie in the wisdom and
unselfish patriotism of all officials and in their faithful adherence to the
Constitution.
Wherefore, Executive Orders Nos. 545 and 546 are hereby declared null
and void, and the respondents are ordered to desist from appropriating,
releasing, allotting, and expending the public funds set aside therein. So
ordered, without costs.
Feria, Pablo and Tuason, JJ., concur.
Bengzon, J., concur in the result.
Separate Opinions
PADILLA, J., concurring:
"All appropriation, revenue or tariff bills . . . shall originate exclusively in
the House of Representatives, but the Senate may propose or concur
with amendments."1 "No money shall be paid out of the Treasury except
in pursuance of an appropriation made by law." 2 The authority or power
to appropriate government funds to be spent for public purposes is
lodged exclusively in the Congress because it is purely and essentially a
legislative function. The legislative power to appropriate government
funds for public purposes lodged exclusively in the Congress may,
however, be delegated to the President "in times of war or other national
emergency," "for a limited period and subject to such restrictions as it
may prescribe," "to carry out a declared national policy." 3 This
constitutional provision has no counterpart in the Constitution of the
United States of America and in those patterned after it. Under this
provision of the Constitution several emergency powers acts, notably
Com. Acts Nos. 600 and 671, were passed.4 Being a deviation from the
principle of separation of powers the delegation of legislative powers
authorized by the Constitution may validly be made only by adhering
strictly to its spirit and letter. Pursuant thereto the legislative authority or
power to be granted or delegated to the President by the Congress must
be "in times of war or other national emergency" and "for a limited period
and subject to such restrictions as it may prescribe," and the Congress
has to pass a law for that purpose. The reason why the Constitution is
silent on or does not provide for the manner the delegation of legislative
powers may be withdrawn, revoked or ended, is because if it is for a
limited period it lapses at the end of the period and because if the war or
other national emergency which prompted it ceases the delegation of
legislative powers ceases also ipso facto. A law which delegates such
powers to the President for an indefinite period would be unconstitutional
because it is against the express provision of the Constitution. It would be
an abdication of legislative powers. If the law which delegates legislative
powers does not fix or provide for a period of time within or during which
the President may exercise them and there is dispute or doubt as to
whether the national emergency which prompted the Congress to pass
the law delegating legislative powers to the President continues or has
ceased, such dispute or doubt may be determined in an appropriate case
by the courts. Another way of terminating such delegation is by the
Congress itself which made the delegation. To withdraw, terminate or
revoke the delegation of legislative powers to the President a concurrent
resolution would be sufficient.5 The concurrence of the President is
superfluous and unnecessary, for if it be required then the law which
delegated legislative powers to him would suffer from a fatal defect, vice,
or infirmity which would render such delegation unconstitutional for lack
of time limitation prescribed and ordained by the Constitution.
It is claimed that just as the delegation of legislative powers to the
President is to be made by means of a law which requires the
concurrence of the President, so the withdrawal, termination or
revocation of the legislative powers delegated to him must also be with
his concurrence and approval. The reason for the requirements that a law
be passed to make the delegation of legislative powers valid and
effective is the fact that whereas the Congress may deem it wise and
expedient to make the delegation, the President may hold a different
view. In other words, he has to concur and accept the powers delegated
to him by the Congress. But when it comes to withdrawal, termination or
revocation of the legislative powers delegated to him his concurrence or
consent is not necessary. The absence of constitutional provision on how
it should be done and carried out is not due to an oversight or to an
intention of the members of the Constitutional Convention to require the
concurrence of the President to make there vocation valid and effective,
because, as heretofore stated, if such concurrence be required to make
the revocation valid and effective, the law which delegated legislative
powers to the President would or might offend against the very provision
of the Constitution which requires and ordains that such delegation be for
a limited period of time only, and because the refusal to concur in by a
President bent on or inclined to continue exercising legislative powers
delegated to him would result in a delegation of legislative powers, at
least during his incumbency or tenure of office, regardless of whether the
reason or reasons for the grant of the authority to exercise such
legislative powers have ceased to exist.
delegation of legislative powers which had been revoked by the
Congress, the only constitutional body empowered and authorized to
make the revocation.
For this reasons I am of the opinion that Executive Orders No. 545 and
546 which appropriate government funds for public works and relief for
the victims of typhoons in some provinces of the Republic are of no
validity and legal effect because the President no longer had the authority
to issue such executive orders under the Emergency Powers Act which
had been withdrawn or revoked by the Congress. The writ of prohibition
prayed for should be granted.

It is contended, however, that in withdrawing, terminating or revoking the

legislative powers delegated to the President the Congress did so by
BENGZON, J., concurring:
passing a bill evincing its intention to have his assent, which he refused
to give, and for that reason the revocation of the legislative powers
delegated to him was ineffective for lack of such concurrence. To I have signed the majority opinion. But I also agree to the above views of
determine what the Congress intended when it passed the bill repealing Mr. Justice Padilla.
the Emergency Powers Acts — the Senate approved it unanimously —
form must give way to substance. If the contention that in passing the bill Labrador, J., concurs.
repealing the Emergency Powers Acts the Congress intended to have the
concurrence of the President be upheld, such a construction would
render the bill contradictory in itself, because in the explanatory notes of
H. No. 692 introduced by Congressman Roy and H. No. 727 by
Congressman Zosa, upon which the consolidated bill passed is based, it REYES, J., concurring:
is declared "that war had long ended," that "the need for the grant of such
unusual powers to the President has disappeared," and that for that It being repugnant to the spirit of the Constitution to let Commonwealth
reason the Congress repealed all Emergency Powers Acts. The congress Act No. 671 degenerate into a grant in perpetuity of legislative powers to
could not have meant or intended to subordinate its opinion or judgment the Executive, and taking House Bill No. 727, approved by the Congress
that the war had ended and that the national emergency had ceased to but vetoed by the President, as a for-the-record pronouncement on the
exist to that of the President, the legislative and not the executive being part of the legislative branch of the Government that the emergency
the department of the Government exclusively clothed or vested with the which impelled it to delegate, through the said Commonwealth Act,
authority and power to make such a declaration. In passing the bill the legislative powers to the President had already ceased, so that there was
Congress committed a mistake in the matter of form but not of substance no longer any need for the exercise of those delegated powers, and,
because the latter is there in the explanatory note of the bill passed by lastly, considering that said Act does not have to be repealed by another
both houses, to wit: "that war had long ended," that "the need for the Act because, as an emergency measure, it repeals itself with the
grant of such unusual powers to the President has disappeared," and that cessation of the emergency, I concur in this opinion of Mr. Justice Padilla.
for that reason it repealed all the Emergency Powers Acts. After the
Congress had made that declaration the President could no longer
exercise the legislative powers delegated to him. It was a complete and
absolute revocation of the delegation of such powers. His veto of the bill
could not and did not have the effect of reviving or continuing the
JUGO, J., concurring:
In addition to the reasons set forth by Chief Justice Paras and Associate
Justice Padilla, I would like to make a few brief remarks:
Section 26 of Article VI of the Philippine Constitution provides as follows:
In times of war or other national emergency, the Congress may
by law authorize the President, for a limited period and subject to
such restrictions as it may prescribed, to promulgate rules and
regulations to carry out a declared national policy.
Section 1 of Commonwealth Act No. 671, which is entitled "An Act
Declaring a State of Total Emergency as a Result of War Involving the
Philippines and Authorizing the President to Promulgate Rules and
Regulations to Meet such Emergency," reads as follows:
The existence of war between the United States and other
countries of Europe and Asia, which involves the Philippines,
makes it necessary to invest the President with extraordinary
powers in order to meet the resulting emergency.
Section 2 of said Commonwealth Act No. 671 invoking section 26, Article
VI, of the Constitution above-quoted, authorized the President during the
existence of the emergency caused by said war to promulgate rules and
regulations, etc.
Executive Order No. 545, dated November 10, 1952, appropriating funds
for urgent and essential public works, states in its preamble, in
justification of said order, that the Congress in its last special session had
failed to appraise funds for the immediate repairs and reconstruction of
certain public buildings and public works, damages by the recent
typhoons, floods, and other calamities.
Executive Order No. 564, dated November 10, 1952, also declared as its
cause that the Congress had failed in its last special session to provide
funds for relief to the victims of the recent typhoons, floods, draughts,
earthquakes, etc.
It will be seen that the authority given by the Constitution to the Congress
to delegate certain legislative powers to the President was for a limited
time. This was naturally so, because an emergency cannot be of a long,
unlimited or indefinite duration, for otherwise it would not be an
emergency.
Commonwealth Act No. 671 was passed on December 16, 1941.
Executive Orders Nos. 545 and 546 were issued on November 10, 1952;
that is, almost eleven years from the date Commonwealth Act No. 671
was enacted. It is hard to conceive of an emergency which has lasted
almost eleven years.
The emergency contemplated by Commonwealth Act No. 671 was not
same emergency invoked in said executive orders, for, whereas
Commonwealth Act No. 671 refers to the emergency created by the
existence of war between the United States and other countries of
Europe involving the Philippines, the executive order above-mentioned
deal with the damages wrought by the recent typhoons, earthquakes,
volcanic eruptions, etc., and the failure of the Congress to provide funds
for the repair and reconstruction of damaged buildings and public works
and the relief of the victims. The recent typhoons, earthquakes, volcanic
eruptions, etc. and the failure of the Congress to provide for them have
nothing to do with the war mentioned in said Commonwealth Act No. 671
and are not the consequences of said war.
For the foregoing reasons, I concur in the majority opinion.
MONTEMAYOR, J., concurring and dissenting:
With the majority I agree that Executive Order Nos. 545 and 546, — the
first appropriating P37,850,500 for urgent and essential public works, the
second appropriating P11,367,600 for relief — are invalid, for the same
reasons given by me in dissenting opinion in cases G.R. No. L-2044,* L-
2756,* and L-3054-56* commonly called the "Emergency Cases of 1949",
namely, that the legislature had already withdrawn from the realm of
presidential legislation or regulation under the emergency powers to
delegate by Commonwealth Act No. 671, the power to appropriate funds
for the expenses of the Government and for other purposes.
To me, however, the more important point involved in the present case is
not the validity of the two executive orders but rather the question of
whether or not Commonwealth Act No. 671 is still has emergency powers
under said Act. And the parties herein, not excluding the Chief Executive
and the Legislature, it is to be presumed, want this point definitely settled.
So, I proposed to devote the considerations in this modest dissenting
opinion to this matter. The majority opinion states that in the emergency
cases of 1949, five members of this tribunal held that Commonwealth Act
671 was still in force. Mr. Justice Padilla concurred in that opinion. With
the concurrence of Mr. Justice Torres in my concurring and dissenting
opinion I also held that Commonwealth Act. 671 was still in force. Mr.
Justice Bengzon in his dissenting opinion in those emergency cases said
that although he was favorably impressed by the reasons set forth by Mr.
Justice Reyes and particular point — the existence or non-existence of
the emergency powers of the President. So that even if we do not include
Mr. Justice Bengzon, we can correctly say that four justices voted in
those emergency cases in favor of the existence of emergency powers of
the President.
In those emergency cases of 1949 I prepared a more or less extensive
opinion in support of the theory that Commonwealth Act No. 671 was still
in force. I wish to embody said opinion in the present opinion by
reference, without prejudice to reproducing portions of the same.
I agree with the majority that Commonwealth Act 671 was to be in force
only for a limited period of time, otherwise be unconstitutional; and that
limited period was co-extensive with the existence of the emergency. But
I emphatically disagree with the majority when it says:
That emergency, which naturally terminated upon the ending of
the last world war, was contemplated by the members of the
National Assembly on the foresight that the actual state of war
would prevent it from holding its next regular session.
As regards the majority's view that emergency Act 671 because due to
war delegated by Commonwealth Act 671 because due to emergency the
National Assembly would be unable to hold its regular session, I
discussed and I hope I refused this theory in my dissenting opinion in the
1949 emergency cases and I take the liberty of quoting a pertinent
portion thereof:
I believe that, as I already had occasion to state though
incidentally, the real reason for the delegation of legislative
powers to the Chief Executive is not only because the Legislature
is unable to meet due to a national emergency but also because
although it could and does actually meet, whether in regular or
special session, it is not in a position and able to cope with the
problems brought about by and raising from the emergency,
problems which require urgent and immediate action. Certainly,
one man can act more quickly and expeditiously than about one
hundred members of the Legislature, especially when they are
divided into Legislative chambers. That is why in times of
emergency, much as we in democratic countries dislike the
system or idea of dictatorship, we hear of food dictator, fuel
dictator, transportations which ordinarily belong to a council or
board or to a legislative body, are entrusted under certain
limitations to one single official or individual.
Supposing that during a national emergency and while the
legislature is in session, the legislature woke up one morning to
find that there was extreme scarcity of imported foods, fuel,
building materials, equipment required in agriculture and industry,
etc., because of a monopoly, hoarding, injurious speculations,
manipulations, private controls and profiteering, or that there were
widespread lockouts and strikes paralyzing transportation,
commerce and industry, or rampant espionage or sabotage
endangering the very life security of the necessary legislation in
order to cope with the situation and pass the necessary
emergency measures?
We are all familiar with the practice and routine of enacting laws.
A bill is introduced in the Legislature; it is referred to the
corresponding committee, it is studied by said committee, which
in some cases holds public hearings; the committee discusses
the bill and sometimes introduces amendments; if the bill is not
killed in the committee or shelved, it is submitted to the chamber
for study, discussion, and possible amendment by all the
members; it is finally voted and if approved, it is sent to the other
house where it undergoes the same process; and if it is finally
approved by both houses of Congress, it is submitted to the Chief
Executive for his study and approval or veto. All this may
consume weeks or months as a result of which, ordinarily, many
bills finally approved by Congress could be sent to the President
for approval or veto only after adjournment of the legislative
session. And we should not overlook the fact that in some cases
for lack of time or due to disagreement among the legislators or
between the two houses of Congress, important pieces of
legislations like the annual appropriation law for the fiscal year
1949-50, appropriation founds for the elections to be held in
November, 1949, contained in Executive Orders Nos. 225 and
226, involved in the present cases, and the proposed amendment
to the Election Code etc., have not been passed by Congress in
its last session ending last May, 1949, which session lasted one
hundred days. If we were to rely on the ordinary process of
legislation to meet a national emergency, by the time the
necessary and needed law is passed, the situation sought to be
remedied, or the problem sought to be solved may have become
disastrous or ended in calamity or gone beyond legislations or
any remedy. It would be too late. It would be like locking the
stable door after the horse had been stolen.
Now, for some retrospect, The Philippine National Assembly
delegated its legislative powers because of the existence of a
state of national emergency as early as the year 1939. During it
second special session of that year, it promulgated the following
laws: (Commonwealth Acts Nos. 494, 496, 498 and 500).
At that time, September, 1939, the second world war was only in
Europe, quite far from the Philippines and had just begun. There
was then no likelihood of the Philippines being involved in the
war. In fact, the Philippines did not get involved in the war until
more than two years, in December, 1941. The National Assembly
was then free to meet either in regular or special sessions to
enact legislation to meet the emergency. In fact, it met in regular
session in January, 1940 lasting 100 days, excluding the several
special sessions held during those two years. And yet the
Assembly delegated legislative powers to the President under
section 26, Article VI of the Constitution. This is clear proof that,
contrary to the theory of the majority opinion, the legislature
delegated legislative powers to the President even when it could
meet and it actually met several times.
After passing the Acts just mentioned delegating legislative
powers to the President, the Assembly in its fourth special
session on August 19, 1940 repeated and reiterated this practice
and policy by passing Commonwealth Act No. 600 delegating
additional and more extensive legislative powers to the President
in spite of the fact that the war was still far away in Europe and
there was no danger or prospect of involving the Philippines, and
the legislature was still free to meet as in fact it met again in
regular session in January, 1941. During its regular session
begun that month and year, instead of stopping or ending the
legislative powers delegated to the President, because according
to the theory of the majority opinion, the Legislature was able to
meet, the Assembly allowed them to continue by passing
Commonwealth Act No. 620 which merely amended section 1 of
Commonwealth Act No. 600. I repeat that all this, far from
supporting the view of the President only because it could not
meet, fairly and squarely refutes said view.
As to the proposition in the majority opinion that the emergency
terminated with the war. I am afraid the majority confuses war with
emergency. They are two different and separate things and events. Even
the Constitution (Article VI, section 26) which for purposes of reference is
reproduced below, considers war and emergency as separate and
distinct:
SEC. 26. In times of war or other national emergency, the
Congress may by law authorize the President, for a limited period
and subject to such restrictions as it may prescribe, to promulgate
rules and regulations to carry out a declared national policy.
There maybe a national emergency without war. And so, when on the
occasion of a war, a national emergency ensues and is recognized and
declared by Congress, said emergency may continue even if and when
the war that started it is ended. War may and generally create an
emergency, but the emergency thus created does not necessarily end
with the war. A war may last only several weeks or months but with the
use of the modern weapons of warfare it may cause such devastation,
desolation and national suffering and collapse not only economically but
socially and morally that the resulting emergency may last for years. A
destructive flood, tornado, tidal wave or volcanic eruption may last only
minutes or hours but the destruction that it leaves in its wake may take
weeks, months or years to repair, and the emergency thereby created
may last that long.
To bolster its contention the majority cites President Quezon's book "The
Good Fight" pp. 204-205, wherein he speaks in time of war. I am afraid
the citation proves nothing. He merely said that the delegation was made
in time of war. He did not say or mean that the powers thus delegated
were to be exercised only during the war. The main thing to be
considered and which calls for the exercise of the powers delegated is
the emergency, not the war that merely started or caused it.
Commonwealth Act 671 itself in its section 2 says that the President will
exercise his emergency powers during the existence of the emergency. It
does not say during the existence of the war.
President Quezon is hardly the authority that the majority should quote to
support its theory that emergency powers are given to the Chief
Executive just because due to the emergency, the Legislature is unable
to meet. It was President Quezon who was given emergency powers as
early as 1939 under Commonwealth Acts Nos. 494, 496, 498 and 500
when the war was still far away in Europe and we were not yet involved
and the National Assembly could still meet and actually did meet several
times in two years, 1940 and 1941, in regular and special sessions, and
during those two years when the National Assembly was holding its
sessions, he was exercising his emergency powers and enacting
legislation by means of Executive Orders. Evidently, he did not see any
incompatibility in the grant and exercise of emergency powers with the
ability of the Legislature to meet and in actually holding session, this, all
contrary to the majority's contention.
Hostilities incident to the last Pacific war have long ended since 1945; it
does not however necessarily mean that the emergency resulting from
said war has ceased and that the disruption of trade dislocation of the
economy of the country, the destruction of public and private property,
the breakdown in honesty and morality and the collapse of peace and
order, all resulting from that war have disappeared, and that everything
has returned to normalcy. In support of its theory that the emergency has
ceased the majority makes reference to Republic Act 342 wherein it is
stated that conditions have gradually returned to normal. But this same
law clearly says that the emergency created by the last war as regards
war sufferers who have not received any relief for the loss or destruction
resulting from the war, still exists and so postpones payment of their
debts or monetary obligations contracted before the war, for a period of
eight (8) years from and after the settlement of their war damage claims
by the United States-Philippine War Damage Commission. In other
words, the Congress of the Philippines believes that at least as regards
war sufferers, the emergency resulting from the last war still exists, and
will exists not only up to the time that their war damage claims are paid
but for a period of eight years thereafter. This hardly supports the
majority's theory that everything is normal, and that there no longer is any
emergency because the war has long ended.
In connection with this question of whether or not there is still an
emergency resulting from the last war and whether or not things and
conditions have returned to normal, I permit myself to reproduce a portion
of my dissenting opinion in the 1949 emergency cases:
The last logical question that one will naturally ask is: has the
emergency resulting from the war passed or does it still exists?
This is a fair and decisive question inasmuch as the existence of
the emergency is, in my opinion, the test and the only basis of the
operation or cessation of Act 671. The existence or non-existence
of the emergency resulting from the war is question of fact. It is
based on conditions obtaining among the people and in the
country and perhaps even near and around it. It is a highly
controversial question on which people may honestly differ. There
are those who in all good faith believe and claim that conditions
have returned to normal; that the people have now enough to eat,
sometime even more than they had before the war; that people
nowadays especially in the cities are better nourished and clothed
and transported and better compensated for their labor, and that
the President himself in his speeches, chats and messages had
assured the public that normal times have returned, that the
problem of peace and order had been solved, that the finances of
the Government and the national economy are sound, and that
there is an adequate food supply. It is, therefore, claimed that
there is no longer any emergency resulting from the war.
On the other hand, it is asserted with equal vehemence in the
opposite camp that conditions are still far from normal; that the
picture painted by the President in cheerful and reassuring colors
is based on over optimism and, as to be expected, calculated to
show in bold relief the achievements of the administration, and so
should be considered with some allowance; that we are now
importing more rice than before the war for the reason that many
rice farms are idle because of the farmers fear of or interference
by dissidents; that the problem of peace and order is far from
solved as shown by the frequent hold-ups, kidnappings, lootings
and killing and organized banditry not only in Luzon but also in
the Visayas and Mindanao; that whereas before the war, the
Constabulary force consisting of only about 6,000 officers and
men could provide complete protection to life and property was
adequate in all respects to enforce peace and order, now this
Constabulary enlarged to about 20,000 men, provided with
modern weapons and equipment and with the aid of thousands of
civilian guards and of the Philippine Army and Air Force cannot
solve the peace and order problem; that the dissidents who are
well-organized, armed and disciplined even attack and sack
towns and sometimes openly defy and engage the armed
Government forces; that as long as more than 100,000 firearms
are loose and in the hands of irresponsible parties, not excluding
the seemingly regular mysterious supply to them of additional
firearms and ammunitions, there can be no peace and order; and
 as to the barrio folk in Central Luzon and now, even in provinces
bordering Central Luzon whose parents and relatives had been
killed by dissidents, whose women folk had been outraged by the
same elements, whose homes had been looted and burned and
whose very lives had been subjected to constant terror and peril,
compelling them to leave their homes and their farms and
evacuate to and be concentrated in the poblaciones to live there
in utter discomfort and privation, it is said that it would be difficult
to convince these unfortunate people that normalcy has returned
and that there is no longer emergency resulting from the war. To
further support the claim of the existence of an emergency, the
menace of communism not only at home, particularly in Central
Luzon but from abroad, especially China, is invoked. And it is
asserted that all this is a result of the war.
To the above are those who claim and will add that since 1949 up to the
present time, although rehabilitation progressed substantially, there are
still many people who have not achieved rehabilitation. The economy of
the country is still far from what it was before the war. It is being bolstered
temporarily by the millions of pesos being received by war veterans, their
widows and children in the form of pensions or insurance; by the millions
being spent by the Mutual Security Agent (MSA) in the Philippines to
rehabilitate agriculture, industry, commerce, etc.; by the millions being
sent here by the United States in war materials, equipment, etc. in
relation with the United States military aid to the Philippines, and with the
enforcement of the Import Control, Exchange Control and other laws all
of a temporary nature intended to temper and minimize the financial and
economic crisis which otherwise would overwhelm the country. The
coastwise trade is being maintained with ships originally built for and
used during the war, converted provisionally into inter-island freight and
passenger boats; and land transportation specially in the centers of
population like Manila is operated in great measure with vehicles (used
jeeps) obtained from the Surplus Property Commission. Everything is on
a provisional basis. What will happen after these boats and motor
vehicles wear out and become junk? Could they be readily replaced by
their owners or operators? Sunken boats will clutter the harbors of the
country particularly Manila Bay, constituting a menace to navigation.
Squatters in great number are still a problem, claiming that they have
nowhere to go to live. Government and private buildings, and churches
are still ruins, tenanted by squatters. Intramuros, the Walled City, in the
very City of Manila is a living example of non-rehabilitation, with the
hundreds and thousands of owners of lots therein either financially
unable to reconstruct or prohibited from rebuilding until the Government
has completed its plan about its reconstruction.
The War Damage Commission has paid war damage claims, it is true,
but only a portion of the amounts of the claims; and with prices as they
are and the low purchasing power of the peso, complete rehabilitation of
war sufferers and substantial repair of the war damage is impossible. The
country is claiming reparations from Japan in the amount of eight (8)
billion dollars. It is not known if Japan can or will ever pay them and
when. That is why the legislature in Republic Act 342 wisely postponed
payment of debts and monetary obligations of sufferers, not up to the
payment of their war damage claims, but eight years thereafter, realizing
perhaps that the amounts paid for war damage claims are inadequate to
achieve complete rehabilitation. So the Legislature says that as to these
war sufferers, the emergency still exists. And who has not suffered
damage during the last war?
We have not yet completely risen from the low level into which we had
sunk during and immediately after the war, in public and private morality,
decency, honesty and personal integrity as witnessed by the more or less
rampant misappropriations and defalcations by public officials, corruption
and malfeasance, bribery, ten percentage, guerrilla recognition and
veterans benefits rackets, dynamite fishing, etc.
When the President makes his inspections, especially in the troubled
area, he is escorted by contingents of fully armed soldiers, sometimes
with machine guns and tanks. High officials of the Government using low
plate numbers of their cars, use high plate numbers called "security plate
numbers" when travelling in the provinces to minimize the danger hold-
ups and attacks by dissidents who are said to be after the high
government officials. People are advised not to travel at night over
certain provincial highways even national roads.
Peace and order still leaves much to be desired. In 1949 when the
emergency cases were decided, five justices held the opinion that there
no longer was any emergency. But conditions of peace and order actually
worsened thereafter. There was an uprising or rebellion in Batangas by
Medrano and his men after November, 1949, and it is said that unable to
cope with the uprising and bring the rebels to justice the Government was
compelled to offer them amnesty. Since 1949 the HUKS and the
communists became stronger, in fact became so strong that they actually
threatened the existence of the Government which was forced to
increase its army and wage campaigns not only in the field but also in
centers of population where it was able to arrest and prosecute those
whom it claims to be high officials of the POLITBURO. In Sulu, the
Government waged an intensive campaign against Kamlon and his men
spending several million pesos and losing quite a number of soldiers and
officers, with no decisive result, and it was only after Kamlon and his men
had been promised executive clemency that they surrendered to the
authorities, stood trial, were convicted and promptly pardoned. Some of
Kamlon's relatives with their followers are said to be still in the mountains
and forests and refuse to surrender unless offered the same conditions.
Not long ago several hundred Chinese said to be dangerous communists
were rounded up in several towns and cities in the Philippines. About two
or three weeks ago, according to the papers the army authorities said
that up to that time they had through confiscation, capture, surrender and
purchase, been able to collect about 40,000 loose firearms but that there
still remained about 100,000 more to be accounted for. The other day the
Provincial Commander of Lanao said that he is faced with the problem of
eliminating or capturing ten outlaw bands in the province with about 700
followers, The hold-ups, massacres, raids and ambushes in different
provinces, even near Manila have not ceased. As long as over 100,000
loose firearms are still in the hands of lawless or irresponsible persons,
there can be no complete peace and order in the country. Before the war
about 5,000 Constabulary soldiers and officers with an appropriation of
about three million pesos was able to maintain peace and order
throughout the country. The Armed Forces of the Philippines including
the Constabulary of the country in 1949 numbered 37,000. Realizing that
this number was unable to maintain peace and order it was increased
substantially so that in 1952, it went up to 56,000 men and officers with
an appropriation of over P151,000,000, an amount by far larger than the
appropriation for the Department of Public Schools which gives
instruction and education to school children and students. With the help
of thousands of temporary and special policemen, civilian guards and
commandos the army and the constabulary are still battling dissidents,
communists and bandits. Hundreds and thousands of families from
Central Luzon, particularly Pampanga are still marooned in Manila,
Baguio and other centers of population, unable and afraid to return to
their homes, and a number of them more fearless and optimistic, who
thought that peace and order in Central Luzon had been restored,
returned to their homes there but were kidnapped and liquidate. Farmers
harvesting rice in some barrios in Central Luzon have to be guarded by
the armed forces so as not to be molested by the dissidents. Only
yesterday the papers carried the news that 14,000 soldiers and officers
have started an intensive campaign in Central and Southern Luzon
against lawless elements. All this, many people still honestly believe.
Considering all this, one may well doubt that peace and order in the
country has gone back to normal, and that there is no longer any
emergency. And this emergency clearly is the result of the last war. The
HUKS movement was born during that war and the hundreds of
thousands of loose firearms were also released and distributed
indiscriminately during that war. Lawlessness and banditry always follow
a war, and it takes several years thereafter to restore peace and order. In
the face of all the foregoing which may regard as facts and realities, the
majority without any data in the form of evidence received at a hearing or
trial, but based perhaps on judicial notice and personal knowledge and
observation holds that everything has gone back to normal and that no
longer is any emergency.
Personally, I cannot say that the emergency resulting from the last war
still exists, but neither am I prepared to say that it no longer exists. It is
such a controversial question upon which people may not and could
honestly differ. There are authorities to the effect that the existence or
non-existence of an emergency calling for the exercise of emergency
powers is a political question which can be decided only by the political
department, and that the courts are not called upon, neither are they
authorized to pass upon the question. This was one of the views
maintained in the concurring and dissenting opinion of Mr. Justice Alex.
Reyes concurred in by Mr. Justice Padilla in the 1949 emergency cases.
But assuming for a moment that this court had the authority to pass upon
this point and to bind the executive and legislative department with is
finding, I believe that we have no data or evidence on which to base our
finding. If the findings of courts on questions of facts are given authority
or binding effect it is because those findings are based on facts
established during the hearing by means of evidence adduced by both
parties who given the right to present, cross-examine and impeach
witnesses, object to questions and object to the admission of evidence in
general. In the present case no such hearing or trial for the reception of
evidence was ever had. Consequently, in my opinion we are not
warranted in finding that there still exist or there no longer exists any
emergency resulting from the last Pacific War.
It is the Legislature that granted or delegated the emergency powers or
the Chief Executive to whom the delegation was made that decide
whether or not the emergency continues. There has been lack of
agreement between the two departments on this point since the last
session of the Legislature. While the President up to a few weeks ago
has been exercising his emergency still existed, because Commonwealth
Act 671 provides that he may exercise those powers only during the
emergency, the Legislature has passed House Bill No. 727 in an attempt
to withdraw said emergency powers on the theory that the emergency
has ceased. To end and definitely settle this disagreement, we are called
upon to render decision.
In my dissenting opinion in the 1949 emergency cases I held that the
President still had the emergency powers delegated to him under
Commonwealth Act 671. Three justices of this court held that same view
as I did excluding one Justice who was favorably impressed with that
view though he preferred not to vote directly upon it. Today, tho it seems
in the tribunal, I am the lone dissenter on this proposition and so mine is
reduced so to speak to the "voice in the wilderness," I still maintain the
same view, and there is reason to believe that there are many others who
subscribe to the same opinion. The Legislature in passing during its last
session House Bill No. 727 repealing the latest Commonwealth Acts
including Commonwealth Act No. 671, delegating emergency powers to
the Chief Executive, must have believed and been satisfied that the
President still had those emergency powers otherwise, there would have
been no need of going to all the trouble and the tedious process of
approving a bill withdrawing said powers from him. There would have
been no necessity for the Legislature to repeal a law which it believed to
be no longer operative. There is no reason or point in withdrawing
something that is not there or that no longer exists.
In previous sessions of the Legislature after Liberation there had been
talk or move to enact legislation withdrawing said emergency powers by
presumably the atmosphere was not favorable or the necessary votes to
pass the corresponding measure was not available. It was in the last
session of the Legislature that a bill was finally approved by both House
of Congress. The Chief Executive, however, vetoed it and it was not
repassed over his veto. In spite of this, did the Legislature succeed in
withdrawing his emergency powers? The majority through a process of
interpretation which to me, is strained and unwarranted, voted in the
affirmative. I disagree. We should not forget that in House Bill No. 727
the Legislature was not only expressing its wish and desire to withdraw
the emergency powers of the President. It wanted to repeal the law or
laws delegating said emergency powers. A law can be repealed only by
another law. Consequently, since House Bill No 727 did not become a
law because of the veto of the President, it could not repeal the law or
laws which it sought to abrogate.
I agree with the majority and also with Mr. Justice Padilla that the
emergency powers delegated to the President could be withdrawn by
means of a mere concurrent resolution. It is true that to delegate
emergency powers under section 26, Art. VI of the Constitution, a law is
necessary. It is because the Constitution expressly says so. Moreover, it
is not only convenient but equally necessary that a law should be passed
for that purpose in whose approval the Chief Executive takes part,
because after all he is the one to whom the delegation is made and who
would later exercise the powers so delegated. If he believes that there is
no emergency or that even if there were, it is not of sufficient magnitude
and seriousness as to call for the delegation and the exercise of
emergency powers, he may veto the bill of delegation and that would be
the end of it. It is far from likely that the bill would be repassed over his
veto because it would be futile and pointless to make delegation of
powers to an unwilling delegate who later would decline and refuse to
exercise them. But if he approves the bill of delegation and it becomes a
law then the delegation is complete, successful and effective for the
exercise of the powers by the President would be assured. Not so with
the withdrawal of the powers delegated. The Constitution does not say or
require a law for such withdrawal and it may be withdrawn at any time
even when the emergency which motivated said delegation still exists. In
such a case, the Legislature is the sole judge as to the necessity and
advisability of the continuance or cessation of the exercise of emergency
powers by its delegate, the President.
But how did the Legislature go about his attempt to withdraw the
President's emergency powers? It had the choice of approving a mere
concurrent resolution or passing a bill. Both houses of the Legislature are
graced with the presence of constitutional lawyers and legal luminaries
for whom I have great respect. They must have known that a concurrent
resolution was sufficient for the purpose. Atty. Recto, counsel for the
petitioners and member of the Senate knew it and in his oral argument
before this Tribunal, he said that the Legislature merely made a mistake
because it could have just as well approved a concurrent resolution
instead of passing a regular bill.
But to me, it is highly possible and not improbable that the Legislature
knowing that it could withdraw the President's emergency powers by
means of a concurrent resolution or by means of a law, deliberately and
intentionally chose the latter for reasons of its own. The mistake
committed by the Legislature if any was that perhaps it believed that the
Chief Executive would not veto the bill; but veto it, he did and I am afraid
the Legislature has to abide by the consequences. The Legislature knew
that in passing the bill and in submitting it to the Chief Executive as
required by the Constitution, it had to be approved by him either with his
signature or by letting it become a law without any action on his part. He
may also veto it. This was a hazard and a risk which the Legislature
assumed and of which it must have been perfectly aware. But they are
willing to take the risk. Another possible reason why the Legislature
chose to pass a bill instead of a mere concurrent resolution was that it
sought and wanted the intervention and participation of the Chief
Executive himself in the withdrawal of the emergency powers so that he
would also share in the credit and the responsibility for said withdrawal. If this action or inaction of the Legislature on the veto was that it could not
he approved the bill there would be complete understanding between the get the 2/3 votes in both houses to override the veto because some
two departments of the Government, and no hard feelings. Another members who voted in favor of the House Bill No. 727, particularly
reason not entirely improbable is that the decision to withdraw the members of the party of the Chief Executive vetoing the bill and so either
emergency powers from the Chief Executive was a compromise approved the stand taken by him or acquiesced in it and took it in good
arrangement between the two parties in the Legislature. We must grace and let the matter rest, at least for the time being.
remember that our government is run on the basis of the party system.
The President at present happens to be the head of one of the two major In the foregoing considerations on this point are true or could have been
parties in the Legislature. His party is in the minority in the Senate by two true, then there would absolutely be no reason or warrant for the
or three votes but is in the majority by quite a number of votes in the majority's interpreting and considering House Bill No. 727 as a concurrent
lower house. It is not conceivable that his party men in the two houses resolution sufficient to repeal the several laws mentioned in the bill and
consented and agreed to have the emergency powers withdrawn withdraw the emergency powers of the President. In effect, the majority
provided that the Chief Executive consented to and approved of it. And decided to think for the Legislature and to do for the latter what it failed or
so, they agreed to pass the bill for this purpose, but that they would not perhaps did not want to do, namely, to withdraw the emergency powers
agree to concurrent resolution where the Chief Executive would be by means of a concurrent resolution. I repeat that both houses of
ignored and his emergency powers summarily withdrawn without Congress with the legal talent and constitutional authorities, not only
consultation and without his approval. This last view is in some measure among its distinguished members but also among its legal experts and
supported and borne out by the attitude of the Legislature when the assistants, did neither wish nor intend to approve a mere concurrent
House bill No. 727 was vetoed. The members of Congress knew that the resolution but deliberately and intentionally chose to pass a bill, — House
remedy was to override his veto if they wanted to. The Senate approved Bill No. 727 with full realization of the possibilities and chances of its
the bill unanimously and judging from that unanimity, at least in the upper approval or rejection by the Chief Executive to whom it was submitted.
house the 2/3 votes necessary to override the veto was available. But the Under these circumstances, the action of the majority is practically telling
fact is that the Legislature did not only fail to override the veto but it did the Legislature what it should have one and in finally doing it for said
not even make any attempt whatsoever to repass it over the President's Legislature in order to most easily achieve its purpose or wish might be
veto. Added to this, it was a fact that, and this is by no means regarded by some as not only unwarranted but officious and uncalled for.
unimportant, in the month of September, 1952, that is, about two months
after the veto of the bill, about sixty-seven Congressman and two In view of the foregoing reasons, I beg to disagree with the majority.
Senators filed a petition addressed to the President in which they not only
recognized the existence of his emergency powers but even asked him to
exercise the same for the purpose of releasing funds for public works
projects. Excluding the two Senators, the signers constituted more than
the majority of the membership of the lower house. In other words, after
the veto of the bill and after a failure whether intentionally or otherwise of
the Legislative to override the veto, the majority of all the members of the
lower house believed that Congress failed to withdraw the President's
emergency powers and consequently, believed that he still had those
powers, and was even requested to exercise the same. And on
November 8, 1952, the lower house of the Legislature passed Resolution
No. 99 strongly urging the President to exercise his emergency powers
and authorize the expenditure of funds for the relief to provinces visited
by typhoons and floods and other calamities and for other urgent
essential public works projects. This official action of the Lower House
shows that one of the two Houses of Congress officially believes that the
emergency powers of the President had not been withdrawn. One view of
G.R. No. L-2044 August 26, 1949 THE COMMISSION ON ELECTIONS, THE AUDITOR GENERAL and
THE INSULAR TREASURER OF THE PHILIPPINES, respondents.
J. ANTONIO ARANETA, petitioner,
vs. L-2044
RAFAEL DINGLASAN, Judge of First Instance of Manila, and JOSE Paredes, Diaz and Poblador, Jesus G. Barrera, Vicente Hilado, and
P. BENGZON, Fiscal of City of Manila, respondents. Araneta and Araneta for petitioner.
Office of the Solicitor General Felix Bautista Angelo, Assistant Solicitor
x---------------------------------------------------------x General Ruperto Kapunan, Jr., Solicitor Martiniano P. Vico and Assistant
City Fiscal Julio Villamor for respondents.
G.R. No. L-2756 August 26, 1949 Claro M. Recto and Padilla, Carlos and Fernando as amici curiae.

J. ANTONIO ARANETA and GREGORIO VILLAMOR, petitioners, L-2756

vs. Araneta and Araneta and Jesus G. Barrera for petitioners.
EUGENIO ANGELES, Fiscal of City of Manila, respondent. Assistant City Fiscal Luis B. Reyes for respondent.
Claro M. Recto as amici curiae.
x---------------------------------------------------------x
L-3054
Claro M. Recto, Ramon Diokno, Jose O. Vera, Alejo Mabanag, Jose B.
G.R. No. L-3054 August 26, 1949
Laurel, Jr. and Antonio Barredo for petitioner.
Office of the Solicitor General Felix Bautista Angelo for respondent.
EULOGIO RODRIGUEZ, Sr., por si y como Presidente del Partido Vicente de Vera, Chairman, Commission on Elections.
Nacionalista, recurrente, Alfonso Ponce Enrile, Alva J. Hill and Honorio Poblador, Jr. and Emiliano
vs. R. Navarro as amici curiae.
EL TESORERO DE FILIPINAS, recurrido. Jesus G. Barrera, Enrique M. Fernando, Ramon Sunico, and Francisco
A. Rodrigo also as amici curiae.
x---------------------------------------------------------x
L-3055
G.R. No. L-3055 August 26, 1949 Claro M. Recto and Leon Ma. Guerrero for petitioner.
Office of the Solicitor General Felix Bautista Angelo for respondents.
LEON MA. GURRERO, petitioner, V. G. Bunuan, Administrator, Sugar Quota Office.
vs. Jesus G. Barrera, Felixberto M. Serrano, Enrique; Honorio Poblador, Jr.
THE COMMISSIONER OF CUSTOMS and THE ADMINISTRATOR, and Emiliano R. Navarro as amici curiae.
SUGAR QUOTA OFFICE, DEPARTMENT OF COMMERCE AND
INDUSTRY, respondents. L-3056
Claro M. Recto and Antonio Barredo for petitioner.
x---------------------------------------------------------x Office of the Solicitor General Felix Bautista Angelo for respondents.
Vicente de Vera, Chairman, Commission on Elections.
G.R. No. L-3056 August 26, 1949 Alfonso Ponce Enrile, Alva J. Hill, Jesus G. Barrera, Enrique M.
Fernando, Ramon Sunico and Francisco A. Rodrigo; Honorio Poblador,
ANTONIO BARREDO, in his own behalf and on behalf of all Jr. and Emiliano R. Navarro as amici curiae.
taxpayers similarly situated, petitioner,
vs. TUASON, J.:
Three of these cases were consolidated for argument and the other two
were argued separately on other dates. Inasmuch as all of them present
the same fundamental question which, in our view, is decisive, they will
be disposed of jointly. For the same reason we will pass up the objection
to the personality or sufficiency of interest of the petitioners in case G. R.
No. L-3054 and case G. R. No. L-3056 and the question whether
prohibition lies in cases Nos. L-2044 and L-2756. No practical benefit can
be gained from a discussion of the procedural matters since the decision
in the cases wherein the petitioners' cause of action or the propriety of
the procedure followed is not in dispute, will be controlling authority on
the others. Above all, the transcendental importance to the public of
these cases demands that they be settled promptly and definitely,
brushing aside, if we must, technicalities of procedure.
(Avelino vs. Cuenco, G. R. No. L-2821.) The petitions challenge the
validity of executive orders of the President avowedly issued in virtue of
Commonwealth Act No. 671. Involved in cases Nos. L-2044 and L-2756
is Executive Order No. 62, which regulates rentals for houses and lots for
residential buildings. The petitioner, J. Antonio Araneta, is under
prosecution in the Court of First Instance of Manila for violation of the
provisions of this Executive Order, and prays for the issuance of the writ
of prohibition to the judge and the city fiscal. Involved in case L-3055 is
Executive Order No. 192, which aims to control exports from the
Philippines. In this case, Leon Ma. Guerrero seeks a writ of mandamus to
compel the Administrator of the Sugar Quota Office and the
Commissioner of Customs to permit the exportation of shoes by the
petitioner. Both official refuse to issue the required export license on the
ground that the exportation of shoes from the Philippines is forbidden by
this Executive Order. Case No. L-3054 relates to Executive Order No.
225, which appropriates funds for the operation of the Government of the
Republic of the Philippines during the period from July 1, 1949 to June
30, 1950, and for other purposes. The petitioner Eulogio Rodriguez, Sr.,
as a tax-payer, an elector, and president of the Nacionalista Party,
applies for a writ of prohibition to restrain the Treasurer of the Philippines
from disbursing this Executive Order. Affected in case No. L-3056 is
Executive Order No. 226, which appropriates P6,000,000 to defray the
expenses in connection with, and incidental to, the hold lug of the
national elections to be held in November, 1949. The petitioner, Antonio
Barredo, as a citizen, tax-payer and voter, asks this Court to prevent "the
respondents from disbursing, spending or otherwise disposing of that
amount or any part of it."
Notwithstanding allegations in the petitions assailing the constitutionally
of Act No. 671, the petitioners do not press the point in their oral
argument and memorandum. They rest their case chiefly on the
proposition that the Emergency Powers Act (Commonwealth Act No. 671)
has ceased to have any force and effect. This is the basic question we
have referred to, and it is to this question that we will presently address
ourselves and devote greater attention. For the purpose of this decision,
only, the constitutionality of Act No. 671 will be taken for granted, and any
dictum or statement herein which may appear contrary to that hypothesis
should be understood as having been made merely in furtherance of the
main thesis.
Act No. 671 in full is as follows:
AN ACT DECLARING A STATE OF TOTAL EMERGENCY AS A
RESULT OF WAR INVOLVING THE PHILIPPINES AND
AUTHORIZING THE PRESIDENT TO PROMULGATE RULES
AND REGULATIONS TO MEET SUCH EMERGENCY.
Be it enacted by the National Assembly of the Philippines:
SECTION 1. The existence of war between the United States and
other countries of Europe and Asia, which involves the
Philippines, makes it necessary to invest the President with
extraordinary powers in order to meet the resulting emergency.
"SEC. 2. Pursuant to the provisions of Article VI, section 26, of
the Constitution, the President is hereby authorized, during the
existence of the emergency, to promulgate such rules and
regulations as he may deem necessary to carry out the national
policy declared in section 1 hereof. Accordingly, he is, among
other things, empowered (a) to transfer the seat of the
Government or any of its subdivisions, branches, departments,
offices, agencies or instrumentalities; (b) to reorganize the
Government of the Commonwealth including the determination of
the order of precedence of the heads of the Executive
Department; (c) to create new subdivisions, branches,
departments, agencies or instrumentalities of government and to
abolish any of those already existing; (d) to continue in force laws
and appropriations which would lapse or otherwise become
inoperative, and to modify or suspend the operation or application
of those of an administrative character; (e) to impose new taxes
or to increase, reduce, suspend or abolish those in existence; (f)
to raise funds through the issuance of bonds or otherwise, and to
authorize the expenditure of the proceeds thereof; (g) to authorize
the national, provincial, city or municipal governments to incur in
 overdrafts for purposes that he may approve; (h) to declare the
suspension of the collection of credits or the payment of debts;
and (i) to exercise such other powers as he may deem to enable
the Government to fulfill its responsibities and to maintain and
enforce the authority.
SEC. 3. The President of the Philippines shall as soon as
practicable upon the convening of the Congress of the Philippines
report thereto all the rules and regulations promulgated by him
under the powers herein granted.
SEC. 4. This Act shall take effect upon its approval and the rules
and regulations promulgated hereunder shall be in force and
effect until the Congress of the Philippines shall otherwise
provide.
Section 26 of Article VI of the Constitution provides:
In time of war or other national emergency, the Congress may by
law authorize the President, for a limited period and subject to
such restrictions as it may prescribe, to promulgate rules and
regulations to carry out a declared national policy.
Commonwealth Act No. 671 does not in term fix the duration of its
effectiveness. The intention of the Act has to be sought for in its nature,
the object to be accomplish, the purpose to be subserved, and its relation
to the Constitution. The consequences of the various constructions
offered will also be resorted to as additional aid to interpretation. We test
a rule by its results.
Article VI of the Constitution provides that any law passed by virtue
thereof should be "for a limited period." "Limited" has been defined to
mean "restricted; bounded; prescribed; confined within positive bounds;
restrictive in duration, extent or scope." (Encyclopedia Law Dictionary,
3rd ed., 669; Black's Law Dictionary, 3rd ed., 1120.) The words "limited
period" as used in the Constitution are beyond question intended to mean
restrictive in duration. Emergency, in order to justify the delegation of
emergency powers, "must be temporary or it can not be said to be an
emergency." (First Trust Joint Stock Land Bank of Chicago vs. Adolph P.
Arp, et al., 120 A. L. R., 937, 938.).
It is to be presumed that Commonwealth Act No. 671 was approved with
this limitation in view. The opposite theory would make the law repugnant
to the Constitution, and is contrary to the principle that the legislature is
deemed to have full knowledge of the constitutional scope of its powers.
The assertion that new legislation is needed to repeal the act would not
be in harmony with the Constitution either. If a new and different law were
necessary to terminate the delegation, the period for the delegation, it
has been correctly pointed out, would be unlimited, indefinite, negative
and uncertain; "that which was intended to meet a temporary emergency
may become permanent law," (Peck vs. Fink, 2 Fed. [2d], 912); for
Congress might not enact the repeal, and even if it would, the repeal
might not meet the approval of the President, and the Congress might not
be able to override the veto. Furthermore, this would create the anomaly
that, while Congress might delegate its powers by simple majority, it
might not be able to recall them except by a two-third vote. In other
words, it would be easier for Congress to delegate its powers than to take
them back. This is not right and is not, and ought not to be, the law.
Corwin, President: Office and Powers, 1948 ed., p. 160, says:
It is generally agreed that the maxim that the legislature may not
delegate its powers signifies at the very least that the legislature
may not abdicate its powers: Yet how, in view of the scope that
legislative delegations take nowadays, is the line between
delegation and abdication to be maintained? Only, I urge, by
rendering the delegated powers recoverable without the consent
of the delegate; . . . .
Section 4 goes far to settle the legislative intention of this phase of Act
No. 671. Section 4 stipulates that "the rules and regulations promulgated
thereunder shall be in full force and effect until the Congress of the
Philippines shall otherwise provide." The silence of the law regarding the
repeal of the authority itself, in the face of the express provision for the
repeal of the rules and regulations issued in pursuance of it, a clear
manifestation of the belief held by the National Assembly that there was
no necessity to provide for the former. It would be strange if having no
idea about the time the Emergency Powers Act was to be effective the
National Assemble failed to make a provision for this termination in the
same way that it did for the termination of the effects and incidents of the
delegation. There would be no point in repealing or annulling the rules
and regulations promulgated under a law if the law itself was to remain in
force, since, in that case, the President could not only make new rules
and regulations but he could restore the ones already annulled by the
legislature.
More anomalous than the exercise of legislative function by the Executive
when Congress is in the unobstructed exercise of its authority is the fact
that there would be two legislative bodies operating over the same field,
legislating concurrently and simultaneously, mutually nullifying each
other's actions. Even if the emergency powers of the President, as
suggested, be suspended while Congress was in session and be revived
after each adjournment, the anomaly would not be limited. Congress by a
two-third vote could repeal executive orders promulgated by the
President during congressional recess, and the President in turn could
treat in the same manner, between sessions of Congress, laws enacted
by the latter. This is not a fantastic apprehension; in two instances it
materialized. In entire good faith, and inspired only by the best interests
of the country as they saw them, a former President promulgated an
executive order regulating house rentals after he had vetoed a bill on the
subject enacted by Congress, and the present Chief Executive issued an
executive order on export control after Congress had refused to approve
the measure.
Quiet apart from these anomalies, there is good basis in the language of
Act No. 671 for the inference that the National Assembly restricted the life
of the emergency powers of the President to the time the Legislature was
prevented from holding sessions due to enemy action or other causes
brought on by the war. Section 3 provides:
The President of the Philippines shall as soon as practicable
upon the convening of the Congress of the Philippines report
thereto all the rules and regulations promulgated by him under
the powers herein granted.
The clear tenor of this provision is that there was to be only one meeting
of Congress at which the President was to give an account of his
trusteeship. The section did not say each meeting, which it could very
well have said if that had been the intention. If the National Assembly did
not think that the report in section 3 was to be the first and last Congress
Act No. 671 would lapsed, what reason could there be for its failure to
provide in appropriate and clear terms for the filing of subsequent
reports? Such reports, if the President was expected to continue making
laws in the forms of rules, regulations and executive orders, were as
important, of as unimportant, as the initial one.
As a contemporary construction, President Quezon's statement regarding
the duration of Act No. 671 is enlightening and should carry much weight,
considering his part in the passage and in the carrying out of the law. Mr.
Quezon, who called the National Assembly to a special session, who
recommended the enactment of the Emergency Powers Act, if indeed he
was not its author, and who was the very President to be entrusted with
its execution, stated in his autobiography, "The Good Fight," that Act No.
671 was only "for a certain period" and "would become invalid unless
reenacted." These phrases connote automatical extinction of the law
upon the conclusion of a certain period. Together they denote that a new
legislation was necessary to keep alive (not to repeal) the law after the
expiration of that period. They signify that the same law, not a different
one, had to be repassed if the grant should be prolonged.
What then was the contemplated period? President Quezon in the same
paragraph of his autobiography furnished part of the answer. He said he
issued the call for a special session of the National Assembly "when it
became evident that we were completely helpless against air attack, and
that it was most unlikely the Philippine Legislature would hold its next
regular session which was to open on January 1, 1942." (Emphasis
ours.) It can easily be discerned in this statement that the conferring of
enormous powers upon the President was decided upon with specific
view to the inability of the National Assembly to meet. Indeed no other
factor than this inability could have motivated the delegation of powers so
vast as to amount to an abdication by the National Assembly of its
authority. The enactment and continuation of a law so destructive of the
foundations of democratic institutions could not have been conceived
under any circumstance short of a complete disruption and dislocation of
the normal processes of government. Anyway, if we are to uphold the
constitutionality of the act on the basis of its duration, we must start with
the premise that it fixed a definite, limited period. As we have indicated,
the period that best comports with constitutional requirements and
limitations, with the general context of the law and with what we believe
to be the main if not the sole raison d'etre for its enactment, was a period
coextensive with the inability of Congress to function, a period ending
with the conventing of that body.
It is our considered opinion, and we so hold, that Commonwealth Act No.
671 became inoperative when Congress met in regular session on May
25, 1946, and that Executive Orders Nos. 62, 192, 225 and 226 were
issued without authority of law. In setting the session of Congress instead
of the first special session preceded it as the point of expiration of the
Act, we think giving effect to the purpose and intention of the National
Assembly. In a special session, the Congress may "consider general
legislation or only such as he (President) may designate." (Section 9,
Article VI of the Constitution.) In a regular session, the power Congress
to legislate is not circumscribed except by the limitations imposed by the
organic law.
Having arrived at this conclusion, we are relieved of the necessity of
deciding the question as to which department of government is
authorized to inquire whether the contingency on which the law is
predicated still exists. The right of one or another department to declare
the emergency terminated is not in issue. As a matter of fact, we have
endeavored to find the will of the National Assembly—call that will, an
exercise of the police power or the war power — and, once ascertained,
to apply it. Of course, the function of interpreting statutes in proper cases,
as in this, will not be denied the courts as their constitutional prerogative
and duty. In so far as it is insinuated that the Chief Executive has the
exclusive authority to say that war not ended, and may act on the
strength of his opinion and findings in contravention of the law as the
courts have construed it, no legal principle can be found to support the
proposition. There is no pretense that the President has independent or
inherent power to issue such executive orders as those under review. we
take it that the respondents, in sustaining the validity of these executive
orders rely on Act No. 600, Act No. 620, or Act No. 671 of the former
Commonwealth and on no other source. To put it differently, the
President's authority in this connection is purely statutory, in no sense
political or directly derived from the Constitution.
Act No. 671, as we have stressed, ended ex proprio vigore with the
opening of the regular session of Congress on May 25, 1946. Acts Nos.
600 and 620 contain stronger if not conclusive indication that they were
self-liquidating. By express provision the rules and regulations to be
eventually made in pursuance of Acts Nos. 600 and 620, respectively
approved on August 19, 1940 and June 6, 1941, were to be good only up
to the corresponding dates of adjournment of the following sessions of
the Legislature, "unless sooner amended or repealed by the National
Assembly." The logical deduction to be drawn from this provision is that
in the mind of the lawmakers the idea was fixed that the Acts themselves
would lapse not latter than the rules and regulations. The design to
provide for the automatic repeal of those rules and regulations
necessarily was predicated on the consciousness of a prior or at best
simultaneous repeal of their source. Were not this the case, there would
arise the curious spectacle, already painted, and easily foreseen, of the
Legislature amending or repealing rules and regulations of the President
while the latter was empowered to keep or return them into force and to
issue new ones independently of the National Assembly. For the rest, the
reasoning heretofore adduced against the asserted indefinite
continuance of the operation of Act No. 671 equally applies to Acts Nos.
600 and 620.
The other corollary of the opinion we have reached is that the question
whether war, in law or in fact, continues, is irrelevant. If we were to that
actual hostilities between the original belligerents are still raging, the
elusion would not be altered. After the convening of Congress new
legislation had to be approved if the continuation of the emergency
powers, or some of them, was desired. In the light of the conditions
surrounding the approval of the Emergency Power Act, we are of the
opinion that the "state of total emergency as a result of war" envisaged in
the preamble referred to the impending invasion and occupation of the
Philippines by the enemy and the consequent total disorganization of the
Government, principally the impossibility for the National Assembly to act.
The state of affairs was one which called for immediate action and with
which the National Assembly would would not be able to cope. The war
itself and its attendant chaos and calamities could not have necessitated
the delegation had the National Assembly been in a position to operate.
After all the criticism that have been made against the efficiency of the
system of the separation of powers, the fact remains that the Constitution
has set up this form of government, with all its defects and shortcomings,
in preference to the commingling of powers in one man or group of men.
The Filipino people by adopting parliamentary government have given
notice that they share the faith of other democracy-loving people in this
system, with all its faults, as the ideal. The point is, under this framework
of government, legislation is preserved for Congress all the time, not
expecting periods of crisis no matter how serious. Never in the history of
the United States, the basic features of whose Constitution have been
copied in ours, have the specific functions of the legislative branch of
enacting laws been surrendered to another department — unless we
regard as legislating the carrying out of a legislative policy according to
prescribed standards; no, not even when that Republic was fighting a
total war, or when it was engaged in a life-and-death struggle to preserve
the Union. The truth is that under our concept of constitutional
government, in times of extreme perils more than in normal
circumstances "the various branches, executive, legislative, and judicial,"
given the ability to act, are called upon "to the duties and discharge the
responsibilities committed to them respectively."
These observations, though beyond the issue as formulated in this
decision, may, we trust, also serve to answer the vehement plea that for
the good of the Nation, the President should retain his extraordinary
powers as long asturmoil and other ills directly or indirectly traceable to
the late war harass the Philippines.
Upon the foregoing considerations, the petitions will be granted. In order
to avoid any possible disruption and interruption in the normal operation
of the Government, we have deemed it best to depart in these cases
from the ordinary rule to the period for the effectivity of decisions, and to
decree, as it is hereby decreed, that this decision take effect fifteen days
from the date of the entry of final judgment provided in section 8 of Rule
53 of the Rules of Court in relation to section 2 of Rule 35. No costs will
be charged.
Ozaeta, J., concurs.
Separate Opinions
MORAN, C. J., concurring:
I agree with the opinion prepared by Mr. Justice Tuason, except on the
points hereunder discussed.
I believe, on the one hand, that the emergency power of the President
had ceased not in May 1946, when Congress held its regular sessions,
as Mr. Justice Tuason and Mr. Justice Feria maintain, but on June 9,
1945, when Congress convened in a special session to consider general
legislation. The emergency contemplated in Commonwealth Act No. 671,
is "total emergency" which means the state of actual war involving the
Philippines, with the impending invasion and occupation of our country by
the enemy and the consequent total disorganization and paralyzation of
the Government, principally, the impossibility for the National Assembly to
act. This was the only reason and justification for the total relinquishment
of legislative power by Congress in favor of the Chief Executive under
Commonwealth Act No. 671. Such relinquishment was total because the
emergency was also total. Clearly, therefore, the inability of Congress to
act was the soul of the law, and the moment such inability ceased, the
total emergency also ceased and the law likewise ceased to validly exist.
On June 9, 1945, the Congress of the Philippines convened in a special
session "to adopt such measures as may be necessary to meet the
existing emergency" and "for the purpose of considering general
legislation." I hold that from that date, June 9, 1945, Congress was able
and ready to act on all matters, and the emergency powers delegated to
the President in Commonwealth Act No. 671, naturally ceased to exist.
Upon the other hand, while I believe that the emergency powers had
ceased in June 1945, I am not prepared to hold that all executive orders
issued thereafter under Commonwealth Act No. 671, are per se null and
void. It must be borne in mind that these executive orders had been
issued in good faith and with the best of intentions of three successive
Presidents, and some of them may have already produced extensive
effects in the life of the nation. We have, for instance, Executive Order
No. 73, issued on November 12, 1945, appropriating the sum of
P6,750,000 for public works; Executive Order No. 86, issued on January
7, 1946, amending a previous order regarding the organization of the
Supreme Court; Executive Order No. 89, issued on January 1, 1946,
reorganizing the Courts of First Instance; Executive Order No. 184,
issued on November 19, 1948, controlling rice and palay to combat
hunger; and other executive orders appropriating funds for other
purposes. The consequences of a blanket nullification of these executive
orders will be unquestionably serious and harmful. And I hold that before
nullifying them, other important circumstances should be inquired into, as
for instance, whether or not they have been ratified by the Congress
expressly or impliedly, whether their purposes have already been
accomplished entirely or partially, and in last instance, to what extent;
acquiescence of litigants; de facto officers; acts and contrast of parties
acting in good faith; etc. It is my opinion that each executive order must
be viewed in the lights of its peculiar circumstances, and, if necessary
and possible, before nullifying it, precautionary measures should be
taken to avoid harm to public interest and innocent parties.
To illustrate the foregoing proposition of individual consideration of
specific cases, shall go into a brief discussion of the executive orders
involved in the cases now before this Court. With regard to Executive No.
225 on general appropriation, I hold that the court should not declare it
null and void till Congress may have an opportunity to provide a
substitute measure for the sustenance of government. This view is
predicated upon the principle of absolute necessity. Till Congress may
pass a valid appropriation act our government cannot survive without the
executive order in question. It would be absurd for this court to declare
the cessation of an emergency, and by that same declaration permit, if
not abet, the formation of another emergency which would be inevitable
if, by reason of lack of appropriation, government shall cease to function.
In such cases, when apparently the provisions of our laws and
Constitution seem inadequate, the courts must go deeper even than the
very Magna Carta itself and find solution in the basic principles of
preservation of government and of national survival, which in the last
analysis, are the very reasons for the existence of a Constitution. In such
extreme cases, as can come from the present situation, it would be the
height of judicial imprecision to preserve the form of the constitution, and
at the same time permit the disruption and cessation of the government
which that same constitution so intricately designed and firmly
established. Thus, in the remedy of an evil, we shall cause a far greater
one.
It may be argued that the course of action I am taking is founded upon
fear, fear that Congress will again fail to act on the matter of
appropriation, and it may be asserted that the members of the Congress
are presumed to be as patriotic as the members of this Court, if not more,
and that, therefore, we may rest assured that they will not fail to fulfill their
duty. I admit this to be true, and accordingly, I ask what is then the hurry
and necessity for nullifying the executive order on appropriation which we
are sure will soon be substituted by a valid appropriation act? Why not
defer judgment and wait until the special session of Congress so that it
may fulfill its duty as it clearly sees it? I can find no reason against this
suggestion except, perhaps, a desire to assert judicial supremacy in a
case where judicial statemanship is more necessary.
It is also true that the possibility that Congress will again fail to provide
funds for the operation of the government is a remote possibility. But
there is no harm in providing for all the possibilities, both near and
remote. If that remote possibility never comes, well and good, nothing is
lost and the situation is saved. However, if the remote possibility does
come, and it is not impossible, and we had already nullified the executive
order on appropriation, how will the government function and survive? On
the other hand, if we defer judgment upon the nullity of such executive
order, and that remote possibility does come, we still have the saving
lifeline of that executive order which may, perhaps, be tolerated to save
the country from chaos, until a more proper and adequate remedy can be
secured.
With regard to the executive order appropriating funds for the conduct of
the coming elections, I uphold the same view as in the foregoing, namely,
not in abdicating the power of this court to pass upon the validity of an
executive order, but to defer judgment upon such an order until the
legislature may provide a substitute measure. The reason for this is,
likewise, absolute necessity. Without such Executive Order we may have
not elections in November. Elections are the very essence of popular
government for the establishment and preservation of which, our
Constitution has been consecrated. To permit the unwarranted abolition
or even suspension of elections, will surely result either in the denial of
popular representation or in the perpetuation in power of those already in
office. Either result is revolting to our system of government. Briefly
stated, I hold that this court should neither ratify nor nullify this executive
order, but should defer judgment in the same manner and for the same
reasons stated above in connection with the executive order on
appropriations. The Court, in these cases, is confronted not only with
bare issues of law, but with actual anomalous situations pregnant with
possible dangers to the nation, and it is the duty of the Court, as a
dispenser of justice, to find a solution that is both legal and realistic.
With reference to Executive Order No. 62, which regulates rentals for
houses, and Executive Order No. 192, which aims to control exports from
the Philippines, I agree that they must be held null and void upon the
reason stated by Mr. Justice Tuason and Mr. Justice Feria and also upon
those stated by Mr. Justice Montemayor and Mr. Justice Alex Reyes.
My vote, therefore, is that the petitions must be granted in Araneta vs.
Dinglasan, G. R. No. L-2044; Araneta vs. Angeles, G. R. No. L-2756 and
Guerrero vs. Commissioner of Customs, G. R. No. L-3055, and that
judgment must be deferred in Rodriguez vs. El Tesorero de Filipinas, G.
R. No. L-3054 and Barredo vs. The Commission on Election, G. R. No. L-
3056.
PARAS, J., concurring:
I concur in the opinion of Mr. Justice Tuason. I wish to add, however the
following observations: Even assuming, for the sake of argument, that the
legislative intent is to make Commonwealth Act No. 671, effective during
the existence of the emergency contemplated therein and that it is within
the exclusive province of the political departments to determine whether
said emergency continues or has ceased to exist, I am of the conviction
that, in view of the formal and unmistakable declarations of both the
Congress and the President, said Act No. 671, should be held as having
lost its force and effect.
It is important to remember that the kind of emergency expressly spoken
of in the Act is a total emergency resulting from war and that the Act was
passed at a time (December 16, 1941) when there was factually a state
of war involving the Philippines.
In section 1 of Republic Act No. 342, approved on July 26, 1948, it was
categorically declared by the Congress that "since liberation conditions
have gradually returned to normal, but not so with regard to those who
have suffered the ravages of war and who have not received any relief
for the loss and destruction resulting therefrom," and that "the emergency
created by the last war as regards these was sufferers being still existent,
it is the declared policy of the state that as to them the debt moratorium
should be continued in force in a modified form." The President, in turn, in
his speech delivered on July 4, 1949, plainly proclaimed that "what
emergencies it (the Republic) faces today are incidental passing pains
artificially created by seasonal partisanship, very common among
democracies but will disappear with the rains that follow the thunderclaps
not later than November 8 of this year."
We thus have a formal declaration on the part of the Congress that the
emergency created by the last war exists as regards only those debtors
whose war damage claims have not been settled by the United States
Philippine War Damage Commission (section 2, Republic Act No. 342),
patently meaning that said emergency is, at most, a partial emergency. It
is needless to point out that only a small portion of the Philippine
population are debtors and not all of those who are debtors are war
damage claimants.
We also have the solemn declaration on the part of the President that the
emergencies faced by the Republic are incidental emergencies artificially
created by seasonal partisanship, clearly meaning that such emergencies
not only are not total but are not the result of war.
If the emergency is, as admitted by the Congress, not total and, as
admitted by the President, not the result of the war, Commonwealth Act
No. 671 has lost its basis and cannot legally give rise to the executive
orders herein involved. Indeed, it is not pretended that said orders are
intended to meet any emergency growing out of the last war. Lack of a
budget, an appropriation for the elections, or an import control law, has
been brought about by the inaction of the Congress unaffected by the last
war, and such emergency, if it may be called so, is not of the kind
contemplated in Commonwealth Act No. 671.
The government has for four years since liberation been normally
functioning; election had been regularly held; a national census had been
taken; Congress had held regular and special session; "people travel
freely most everywhere and more quickly, by land, sea and air, to an
extent that was not hitherto enjoyed," and "business is more brisk than
ever, goods are plentiful, our people even in the remotest communities
and barrios of the country are better dressed, their diet has been
immensely improved, and they look more healthy than they ever did"
(President's fifth monthly radio chat, March 15, 1949); and the sporadic
depredations of the outlaws in isolated areas of the country are but the
last paroxysms of a dying movement (President's State-of-the-Nation
Message, January 24, 1949), — all these certainly negative the existence
of any real (much less total) emergency.
That the Congress had heretofore recognized the cessation of the
emergency is conclusively established by the fact that it had assumed the
task of directly enacting, during its past sessions, measures dealing with
all the matters covered by the specific legislative powers conceded to the
President in Commonwealth Act No. 671. This is in line with the
fundamental reason for the approval of said Act, as may be gathered
from the following statement of President Quezon: "When it became
evident that we were completely helpless against air attack and that it
was most unlikely the Philippine Legislature would hold its next regular
session which was to open on January 1, 1942, the National Assembly
passed into history approving a resolution which reaffirmed the abiding
faith of the Filipino people in, and their loyalty to, the United States. The
assembly also enacted a law granting the President of the Philippines all
the powers that under the Philippine Constitution may be delegated to
him in time of war." (The Good Fight, pp. 204-205.) When President
Quezon said "in time of war", he undoubtedly meant factual war, a
situation that existed at the time of the passage of Commonwealth Act
No. 671.
Indeed, the dissenters admit that any delegated power directly exercised
by the principal is considered withdrawn from the agent. A cursory
examination of Commonwealth Act No. 671 will show that the legislative
function therein specified had been discharged by the Congress. The
following illustrates the powers delegated in the Act and the measures
enacted by the Congress itself covering each:
Section 2 of Commonwealth Act No. 671 —
(a) to transfer the seat of the Government or any of its subdivisions,
branches, departments, offices, agencies or instrumentalities:
Republic Act No. 333 —
An Act to establish the Capital of the Philippines and the
permanent seat of the National Government, to create a capital
city planning commission, to appropriate funds for the acquisition
of private estates within the boundary limits of said city, and to
 authorize the issuance of bonds of the National Government for
the acquisition of private estates, for the subdivision thereof, and
for the construction of streets, bridges, waterworks, sewerage
and other municipal improvements in the capital City. (Approved,
July 17, 1948.)
(b) to reorganize the Government of the Commonwealth including the
determination of the order of precedence of the heads of the Executive
Departments:
Republic Act No. 51 —
Act authorizing the President of the Philippines to reorganize
within one year the different Executive departments, bureaus,
offices, agencies and their instrumentalities of the government,
including the corporations owned or controlled by it. (Approved,
October 4, 1946.)
(c) to create new subdivisions, branches, departments, offices, agencies
or instrumentalities of government and to abolish any of those already
existing:
Commonwealth Act No. 732 —
An Act to create the Department of Foreign Affairs and to
authorize the President of the Philippines to organize said
department as well as the foreign service of the Republic of the
Philippines. (Approved, July 3, 1946.)
(d) to continue in force laws and appropriations which would lapse or
otherwise become inoperative, and to modify or suspend the operation or
application of those of an administrative character:
Commonwealth Act No. 709 —
An Act appropriating the sum of five million pesos to enable the
national housing commission to resume its functions" (Approved,
November 1, 1945.)
Commonwealth Act No. 710 —
An Act to appropriate funds to continue the payment of
Retirement gratuities or pensions under existing laws. (Approved,
November 1, 1945.)
(e) to impose new taxes or to increase, reduce, suspend, or abolish those
in existence:
Republic Act No. 215 —
An Act to amend Section One of the Republic Act numbered
eighty-one providing a new time limit for the waiver of, and/or
extension of the period, within which to perform, accomplish or
comply with, any term, condition, or stipulation required of
locators, holders, lessees, operators of mining claims or
concessions, and of water rights and timber concessions with the
mining industry and the condonation of mining, specific and real
estate taxes, under certain terms and conditions. (Approved,
June 1, 1948.)
Ley No. 321 de la Republica —
Ley que eleva los derechos de transferencia de ganado mayor,
enmendado al efecto el articulo quinientos veintiochos del Codigo
Administrativo Revisado. (Apobada, Junio 9, 1948.)
(f) to raise funds through the issuance of bonds or otherwise, and to
authorize the expenditure of proceeds thereof:
Republic Act No. 265 —
An Act establishing the Central Bank of the Philippines . . . .
(Section 87 [e] No. 7.) Approved, June 15, 1948.)
Republic Act No. 266 —
An Act appropriating such sums as may from time to time be
released by the Central Bank representing excess monetary
reserves, and authorizing the President of the Philippines to issue
bonds, certificates or other evidences of indebtedness covering
such amounts. (Approved, June 15, 1948.)
Republic Act No. 85 —
 An Act creating the Rehabilitation Finance Corporation. (Section
2 [f].) (Approved, Oct. 29, 1946.)
(g) to authorize the National, provincial, city or municipal government to
incur in overdrafts for the purposes that he may approve:
Various Appropriation Acts.
(h) to declare the suspension of the collection of credits or the payments
of debts:
Republic Act No. 342, approved, July 26, 1948.
(i) to exercise such other powers as he may deem necessary to enable
the Government to fulfill its responsibilities and to maintain and enforce
its authority.
The powers included in this subdivision (i) are of course covered by
hundreds of other acts approved by the Congress which, it cannot be
denied, all tend to "enable the Government to fulfill its responsibilities and
to maintain and enforce its authority." Moreover, the withdrawal of the
greater and more important powers may be presumed to have carried the
accessory and less important powers.
There is no merit in the contention that Commonwealth Act No. 671 was
enacted by virtue of the war powers of the Congress. As the Act itself
expressly states, its basis is section 26 of Article VI of the Constitution
which merely authorizes delegation of legislative powers to the President
in times of war or other national emergency. The phrase "in times of war
or other national emergency" is solely indicative or descriptive of the
occasions during which the delegation may be extended and does not
classify the act of delegating legislative functions as a war power. It must
be borne in mind that said section 26 is peculiar to our Constitution, with
the result that the decisions of the Supreme Court of the United States
cited on behalf of the respondents, expounding the theory that the
exercise by the President of his war powers granted by the Congress
cannot be interfered with by the courts, are not controlling. Particularly,
the case of Ludecke vs. Watkins, 92 L. ed., 1883, in which the opinion of
the United States Supreme Court was written by Mr. Justice Frankfurter,
cannot apply, for the further reason that it merely involved the power of
deportation which, even in our jurisdiction, is recognized, it being the rule
here that the courts cannot control the right of the Chief Executive to
determine the existence or sufficiency of the facts justifying an order of
deportation. Upon the other hand, the war power of the President is
separately covered by section 10, paragraph (2), of Article VII, and that of
the Congress by section 25.
Article VI, of the Constitution, which are not invoked for the passage of
Commonwealth Act No. 671.
MONTEMAYOR, J., concurring and dissenting:.
The majority opinion holds that Executive Order No. 62 dated June 21,
1947; Executive Order No. 192 dated December 24, 1948; and Executive
Orders Nos. 225 and 226 both dated June 15, 1949 were issued without
authority of law and therefore illegal and of no legal force and effect. I
concur only in the result. Ordinarily, such concurrence without comment
or explanation would be sufficient and satisfactory. However, in view of
the radical difference between the reasons had and given by the majority
in arriving at the result and those entertained by me, and considering the
transcendental importance of these cases, not only because of the vast
amounts of public funds and the rights of citizens affected but also of the
principles of law involved, and the fact that not only the force and the
effect of a law (Commonwealth Act No. 671) but also the legality and the
force and effect of numerous executive orders issued by several
Presidents during a period of about three years, affecting as they do not
only citizens, their interest and their properties but also the different
departments and offices of the Government, I deem it my duty to set forth
my views and the reasons in support of the same.
There is a claim made about lack of personality of some of the parties-
petitioners particularly, the petitioners in G. R. Nos. L-3054 and L-3056.
Much could be said for and against that claim, but I am willing to brush
aside all defenses and technicalities on this point in order to be able to
consider and decide the more important question of the legality of the
executive orders involved and whether or not Commonwealth Act No.
671 is still in force.
The aforementioned executive orders were issued on the straight of and
by virtue of Commonwealth Act No. 671. The majority holds that
Commonwealth Act No. 671 ceased to have any force and effect on May
25, 1946 when Congress first convened in regular session after
liberation. In This, I disagree for I believe and hold that Commonwealth
Act No. 671 is still in force and in effect. But despite this view, I am not of
the opinion that the executive orders under consideration were issued
without authority.
Starting with Executive Order No. 62, we find that it deals with and
regulates houses and lot rentals. If the legislature had not already acted
and legislated on this matter since the promulgation of Commonwealth
Act No. 671, this would be a proper field for Presidential action. However,
the legislature had already promulgated Commonwealth Act No. 689 and
Republic Act No. 66, regulating house rentals and, as late as the month
of May, 1947, Congress passed House Bill No. 978 further amending
Commonwealth Act No. 689. In other words, in thus acting, the
Legislature had already shown its readiness and ability to legislate on this
matter, and had withdrawn it from the realm of presidential legislation or
regulation under the powers delegated by Commonwealth Act No. 671.
Not only this, but in issuing rules and regulations in the form of executive
orders under his delegated powers, the Chief Executive merely acts as
an agent of the legislature, his principal which made the delegation. As
such agent, he cannot go against the policy and expressed desire of his
principal.
There are radical differences between Commonwealth Act No. 689,
Republic Act No. 66, and House Bill No. 978 on one side and Executive
Order No. 62 on the other. That was the reason why President Roxas
vetoed House Bill No. 978, believing in good faith that it would not solve
and remedy the problem of house rentals as explained by him in his
communication to the House of Representatives of June 21, 1947, setting
forth his views on the bill. The President may not and could not substitute
his opinion however excellent or superior for that of the legislature on
matters of legislation when Congress has already acted and expressed
its opinion and desire on the matter.
With respect to Executive Order No. 192, it will be remembered that
Congress passed Commonwealth Act No. 728, approved on July 2,
1946, authorizing the President to regulate, curtail, control, and prohibit
the exportation of certain products, merchandise and materials. Under
said authority the President issued Executive Order No. 3 dated July 10,
1946, later amending section 2 of said Executive Order by issuing
Executive Order No. 23 dated November 1, 1946, regulating the
exportation of certain products, materials and merchandise. The
important thing to consider is that section 4 of Commonwealth Act No.
728 provided that the authority it granted to the President shall terminate
on December 31, 1948, that is to say, that after said date the Executive
could no longer validly regulate exports under said law. The President,
however, overlooked or ignored said injunction and invoking his
emergency powers under Commonwealth Act No. 671, promulgated
Executive Order No. 192 regulating exports, to take effect on January 1,
1949. What was said with regard to Executive Order No. 62 is applicable
to the lack of authority of the Executive to promulgate Executive Order
No. 192, namely, that on this matter of export control, the legislature had
already withdrawn it from the jurisdiction of the Executive under his
emergency powers after the enactment of Commonwealth Act No. 728.
Any Presidential power or authority on the subject of export control was
derived from said Act. Not only this, but when in section 4 of
Commonwealth Act No. 728 the legislature terminated the authority given
the President to regulate and control exports on December 31, 1948 and
failed or refused to renew said authority, the inference or conclusion and
that after said date Congress deemed any presidential regulation on
exports unnecessary and inadvisable. Therefore, in promulgating
Executive Order No. 192 the Chief Executive acted not only without
legislative authority but also against the wishes and policy of Congress.
This he may not validly do.
With respect to Executive Orders Nos. 225 and 226, the considerations
made with regard to Executive Orders Nos. 62 and 192 are equally
applicable. By previously enacting necessary legislation on the yearly
Government appropriation and on the appropriation of funds for the
expenses incurred in national elections, Congress has shown its
readiness and ability to cope with the financial problems of the
Government on this point. Republic Act No. 80, approved October 22,
1946, appropriating funds for the operation of National Government from
July 1, 1946 to June 30, 1947; Republic Act No. 156 appropriating funds
for the fiscal year 1947-48 and Republic Act No. 320, the appropriation
law for the fiscal year 1948-49 show that Congress was in a position and
able to provide for the yearly expenditures of the Government. And
Republic Act No. 73 appropriating P1,000,000 to defray election
expenses on March 11, 1947; Republic Act No. 147 appropriating
P1,000,000 to defray expenses for the election of provincial city and
municipal officials and eight senators held on November 11, 1947, and
Republic Act No. 235 appropriating P100,000 for the special elections
held on March 23, 1948, to fill vacancies in Representative District No. 4
of Iloilo and No. 1 of Leyte, demonstrated the ability of the Congress to
appropriate money for election purposes. By so doing Congress had
tacitly and impliedly withdrawn this portion of the field where the
President may under his emergency power legislate or promulgate rules
and regulations.
In this connection, it may be stated that in my opinion, the theory
underlying the delegation of emergency powers to the under
Commonwealth Act No. 671 and the similar laws is that the legislature
because of the emergency resulting from the war, would be unable to
meet in order to legislate or although able to meet, because of the
emergency, the ordinary process of legislation would be too slow and
inadequate and could not cope with the emergency. So, as a remedy, the
power and authority of legislation are vested temporarily in the hands of
one man, the Chief Executive. But as regards Executive Orders Nos. 225
and 226, the legislature has demonstrated that not only it could meet but
also it could legislate on this point of appropriations by approving general
appropriation laws for the different fiscal years since liberation as well as
appropriations for the necessary funds for the different national and
provincial elections. Consequently, there no longer was any necessity for
Presidential legislation in this regard. Moreover, and this is not
unimportant, the failure of the Legislature to pass an appropriation law for
the fiscal year 1949-50 and a law appropriating funds for the elections in
November, 1949 was not due to any emergency resulting from the war,
contemplated by Commonwealth Act No. 671, but rather and possibly
due to lack of time and because of the rather abrupt and adjourning of
the last session of the Legislature last May.
As already stated, the majority holds that Act No. 671 ceased to have
force and effect on May 25, 1946. The other view is that it is still in force.
To me this is the main and the more important issue involved in these
cases. In fact the argument of the parties centered on this point. The
importance of this issue may readily be appreciated when it is realized
that on its determination is based, not only the validity or nullity
(according to the theory of the majority opinion), of the four Executive
Orders now under consideration, but also of all the Executive Orders
promulgated under authority of Commonwealth Act No. 671 after May 25,
1946, up to the present time. Its determination will also decide whether or
not the President may still exercise his emergency powers in the future
on matters and subjects not heretofore withdrawn by the Legislature.
Because of my disagreement with the majority on this point, I deem it
necessary to explain and elaborate on my reasons for my disagreement.
For purposes of reference and to facilitate the same, I am reproducing
Commonwealth Act No. 671 in full as well as section 26, Article VI of the
Constitution on which said Act is based:
AN ACT DECLARING A STATE OF TOTAL EMERGENCY AS A
RESULT OF WAR INVOLVING THE PHILIPPINES AND
AUTHORIZING THE PRESIDENT TO PROMULGATE RULES
AND REGULATIONS TO MEET SUCH EMERGENCY.
Be it enacted by the National Assembly of the Philippines:
SECTION 1. The existence of war between the United States and
other countries of Europe and Asia, which involves the
Philippines, makes it necessary to invest the President with
extraordinary powers in order to meet the resulting emergency.
SEC. 2. Pursuant to the provisions of Article VI, section 26, of the
Constitution, the President is hereby authorize, during the
existence of the emergency, to promulgate such rules and
regulations as he may deem necessary to carry out the national
policy declared in section 1 hereof. Accordingly, he is, among
other things, empowered (a) to transfer the seat of the
Government or any of its subdivisions, branches, departments,
offices, agencies or instrumentalities; (b) to reorganize the
Government of the Commonwealth including the determination of
the order of precedence of the heads of the heads of Executive
Departments; (c) to create new subdivisions, branches,
departments, offices, agencies or instrumentalities of government
and to abolish any of those already existing; (d) to continue in
force laws and appropriations which would lapse or otherwise
become inoperative, and to modify or suspend the operation or
application of those of an administrative character; (e) to impose
new taxes to increase, reduce, suspend or abolish those in
existence; (f) to raise funds through the issuance of bonds or
otherwise, and to authorize the expenditure of the proceeds
thereof; (g) to authorize the national, provincial, city or municipal
governments to incur in overdrafts for purposes that he may
approve; (h) to declare the suspension of the collection of credits
or the payments of debts; and (i) to exercise such other powers
as he may deem necessary to enable the Government to fulfill its
responsibilities and to maintain and enforce the authority.
SEC. 3. The President of the Philippines shall as soon as
practicable upon the convening of the Congress of the Philippines
report thereto all the rules and regulations promulgated by him
under the powers herein granted.
SEC. 4. This Act shall take effect upon its approval and the rules
and regulations promulgated hereunder shall be in force and
effect until the Congress of the Philippines shall otherwise
provide.
In time of war or other national emergency, the Congress may by
law authorize the President, for a limited period and subject to
such restrictions as it may prescribe, to promulgate rules and
 regulations to carry our a declared national policy. (Section 26,
Article VI, Constitution.)
I fully agree with the majority when in its opinion it says:
Commonwealth Act No. 671 does not in term fix the duration of its
effectiveness. The intention of the Act has to be sought for in its
nature, the object to be accomplished, the purpose to be sub-
served, and its relation to the Constitution. (Page 5, majority
opinion.)
The main thesis of the majority is that the only reason for the delegation
of legislative powers to the Chief Executive under the Constitution, such
as was done under Commonwealth Act No. 671 was because due to the
emergency resulting from the war, the Legislature could not meet to
enact legislation; that the moment of Legislature could convene there
would no longer be any reason for the exercise by the President of
emergency powers delegated to him; that if, when the Legislature could
meet and actually is in session, the President is allowed to exercise his
delegated legislative powers, there would be the serious anomaly of two
legislative bodies acting at the same time, namely, the Legislature and
the Executive, "mutually nullifying each other's action" ; that the limited
period fixed in Commonwealth Act No. 671 for its life and effectiveness
as required by the Constitution is the interval from the passage of said
Act and the moment that Congress could convene, not in special session
where its power of legislation is limited by the Chief Executive in his call
for special session, but in regular session where it could be free to enact
general legislation; and that unless this automatic ending or cessation of
Act No. 671 is so held, there would be need of another Act or legislation
by the Congress to repeal Act No. 671 in which case, the Chief Executive
may by his veto power effectively block any effort in this direction.
I beg to differ with the foregoing thesis. I believe that, as I already had
occasion to state though incidentally, the real reason for the delegation of
legislative powers to the Chief Executive is not only because the
Legislature is unable to meet due to a national emergency but also
because although it could and does actually meet, whether in regular or
special session, it is not in a position and able to cope with the problems
brought about by and arising from the emergency, problems which
require urgent and immediate action. Certainly, one man can act more
quickly and expeditiously than about one hundred members of the
Legislature, especially when they are divided into legislative chambers.
That is why in times of emergency, much as we in democratic countries
dislike the system or idea of dictatorship, we hear of food dictator, fuel
dictator, transportation dictator, civilian evacuation dictator, etc., where
the functions which ordinarily belong to a council or board or to a
legislative body, are entrusted under certain limitations to one single
official or individual.
Supposing that during a national emergency and while the Legislature is
in session, the legislators woke up one morning to find that there was
extreme scarcity of imported food, fuel, building materials, equipment
required in agriculture and industry, etc., because of a monopoly,
hoarding, injurious speculation, manipulation, private controls and
profiteering, or that there were wide-spread lockouts and strikes
paralyzing transportation, commerce and industry, or rampant espionage
or sabotage endangering the very life and security of the nation. How
much time would it take the legislature to enact the necessary legislation
in order to cope with the situation and pass the necessary emergency
measures?
We are familiar with the practice and routine of enacting laws. A bill is
introduced in the Legislature; it is referred to the corresponding
committee, it is studied by said committee, which in some cases holds
public hearings; the committee discusses the bill and sometimes
introduces amendments; if the bill is not killed in the committee or
shelved, it is submitted to the chamber for study, discussion and possible
amendment by all the members; it is finally voted and if approved, it is
sent to the other house where it undergoes the same process; and if it is
finally approved by both houses of Congress, it is submitted to the Chief
Executive for his study and approval or veto. All these may consume
weeks or months as a result of which, ordinarily, many bills finally
approved by the Congress could be sent to the President for approval or
veto only after adjournment of the legislative session. And we should not
overlook the fact that in some cases for lack of time of due to
disagreement among the legislators or between the two houses of
Congress, important pieces of legislations like the annual appropriation
law for the fiscal year 1949-50, appropriation of funds for the election to
be held in November, 1949, contained in Executive Orders Nos. 225 and
226, involved in the present cases, and the proposed amendment to the
Election Code etc. have not been passed by Congress in its last session
ending last May, 1949, which session lasted one hundred days. If we
were to rely on the ordinary process of legislation to meet a national
emergency, by the time the necessary and needed law is passed, the
situation sought to be remedied, or the problem sought to be solved may
have become disastrous or ended in calamity or gone beyond legislation
or any remedy. It would be too late. It would be like locking the stable
door after the horse had been stolen.
Now, for some retrospect. The Philippine National Assembly delegated its
legislative powers because of the existence of a state of national
emergency as early as the year 1939. During its second special session
of that year, it promulgated the following laws:
(a) Commonwealth Act No. 494, authorizing the President of the
Philippines to suspend until the time of the adjournment of the
next regular session of the National Assembly, either wholly or
partially and under such conditions as he may deem proper, the
operation of Commonwealth Act No. 444, commonly known as
the Eight Hour Labor Law;
(b) Commonwealth Act No. 496, authorizing the President to take
over, for use or operation by the Government, any public service
or enterprise and to pay just compensation in the manner to be
determined by him and to prescribe and promulgate regulations
he may deem essential to carry out the purposes of the Act;
(c) Commonwealth Act No. 498 declaring a state of national
emergency due to a state of war among several nations and as a
measure to prevent scarcity, monopolization, hoarding, injurious
speculations, profiteering, etc. affecting the supply, distribution
movement of foods, clothing, fuel, building materials, agricultural
equiptments etc. authorized the President to purchase any of the
articles or commodities available for storage, for re-sale or
distribution, to fix the maximum selling price of said articles or
commodities and to promulgated such rules and regulations as
he may deem necessary; and
(d) Commonwealth Act No. 500 authorizing the President in view
of the existence of a state of national emergency to reduce the
expenditures of the executive departments of the Government by
the suspension or abandonment of service, activities, or
operations of no immediate importance.
At the time, September, 1939 the second world war was only in Europe,
quite far from the Philippines and had just begun. There was then no
likelihood of the Philippines being involved in the war until more than two
years later, in December, 1941. The National Assembly was then free to
meet either in regular or special session to enact legislation to meet the
emergency. In fact, it met in regular session in January, 1941 lasting 100
days and in January, 1941 for another regular session of 100 days,
excluding the several special session held during those two years. And
yet the Assembly delegated legislative powers to the President under
section 26, Article II of the Constitution. This is clear proof that, contrary
to the theory of the majority opinion, the Legislature delegated legislative
powers to the President even when it could meet and it actually met
several times.
After passing the Acts just mentioned delegating legislative powers to the
President, the Assembly in its fourthly special session on August 19,
1940 repeated and reiterated this practice and policy by passing
Commonwealth Act No. 600 delegating additional and more extensive
powers to the President in spite of the fact that the war was still far away
in Europe and there was no danger or prospect of involving the
Philippines, and the Legislature was still free to meet as in fact it met
again in regular session in January, 1941. During its regular session
begun that month and year, instead of stopping or ending the legislative
powers delegated to the President, because according to the theory of
the majority opinion, the Legislature was able to meet, the Assembly
allowed them to continue by passing Commonwealth Act No. 620 which
merely amended section 1 of Commonwealth Act No. 600. I repeat that
all this, far from supporting the view of the majority that the Legislature
delegated legislative powers to the President only because it could not
meet, fairly and squarely refutes said view.
Now, let us consider the theory of the majority that it would be a great
anomaly to have two legislative bodies, the Legislature and the President
to be acting at the same time, each nullifying the acts of the other. I fail to
see the suggested anomaly. In fact, under the view and interpretation
given by the majority of the delegation of contemplated the simultaneous
functioning of the Legislature and the President, both exercising
legislative powers. And it is a fact that there were several instances of the
legislature and the President both validly and simultaneously exercising
legislative powers.
Under section 2 of Commonwealth Act No. 496 already referred to,
approved on September 30, 1939, the power delegated to the President
to prescribe rules and regulations he may deem essential to carry out the
purposes of the Act, namely, the taking over of and operation by the
Government of any public service or enterprise and to pay for the same,
was to last until the date of the adjournment of the next regular session of
the National Assembly. This means that, during the regular session of the
Assembly which begun in January, 1940 and lasted 100 days, the
President could exercise the emergency powers delegated to him. Again,
under Commonwealth Acts Nos. 600 and 620 the President could and
indeed he exercised his emergency powers during the regular session of
the Assembly which began in January, 1941, when President Quezon
issued at least nine Executive Orders numbered 321, 333, 335, 337, 339,
340, 342, 344 and 345.
The same thing obtains under Commonwealth Act 671. Since under the
view of the majority the emergency power of the President granted him in
Commonwealth Act No. 671 ended only on May 25, 1946, then the
extensive legislative powers delegated to the President under that Act
could be exercised and in fact they were exercised during the five special
session of Congress in the year 1945, which lasted a total of 84 days.
During those special session of 1945, President Osmeña issued several
Executive Orders in the exercise of his emergency powers.
Is there further proof needed to show that the suggested and feared
anomaly and impropriety of the Legislature and the Executive both
exercising legislative functions simultaneously, is more fancied than real?
The situation was contemplated and expressly intended by the
Legislature itself, evidently believing that said condition or state of affairs
was neither anomalous nor improper. There is to my mind really no
incompatibility. At such a time and during the period of their simultaneous
functioning, the Legislature may perform its ordinary legislative duties
taking its time to study, consider, amend and pass bills, reserving to the
President matters requiring and demanding immediate action.
After all, it is for the Legislature to say whether it wants the President to
exercise his emergency powers at the same time that it is in session. It
may validly and properly stipulate in its grant of emergency powers that
they be exercised when the Legislature is not in session. In fact, in one
instance, in Commonwealth Act No. 500, section 2, the Notional
Assembly expressly provided "that the authority herein given shall be
exercised only when the National Assembly is not in session." When in its
other acts of delegation, like Commonwealth Act 671, the Legislature not
only fails to stipulate this condition, but on the contrary, contemplates
Presidential exercise of legislative powers simultaneously with the
Legislature, it is to be presumed that the Legislature intended it and saw
nothing improper or anomalous in it, and it is not for the Court to pass
upon the supposed impropriety or anomaly.
As to the possibility of the Chief Executive validly and successfully
nullifying the acts of the Legislature, to me that is quite remote, if not
impossible. As already stated at the beginning of this opinion, the Chief
Executive acting as an agent of the Legislative under his emergency
powers, may not go against the wishes and policies of his principal. He
can only carry out its wishes and policies, and where his acts and orders
run counter to those of the Legislature, or operate on a field already
withdrawn because the Legislature had already acted therein, his acts or
Executive Orders must give way and will be declared void and of no
effect, by the Courts, as we are doing with the Executive Orders involved
in these cases.
With respect to the claim of the majority opinion that unless the
emergency powers were made to end at the time the President made his
report to Congress when it convened, it would be necessary to enact new
legislation to repeal the act of delegation, in which case the period for the
delegation would be unlimited, indefinite, and uncertain, contrary to the
constitutional provision, I may say that the President was authorized by
Act 671 to exercise emergency powers "during the existence of the
emergency," and not a day longer. To me that is a limited period in
contemplation of the Constitution. There would be no need for a new law
to repeal the Act of delegation, for said Act is self-liquidating. The
moment the emergency ceases, the law itself automatically ceases to
have force and effect, and the Presidential emergency powers also end
with it.
Under my view, had the invasion of the Philippines by the Japanese
forces, which we feared and expected in December, 1941 failed to
materialize either because the invasion was repelled or because the
Japanese high command at the last moment decided to by-pass the
Philippines and divert his forces further south to invade, say Australia, or
if the Pacific war had ended as we all or most of us then expected it to
end sooner within weeks or months after its commencement and that the
emergency resulting therefrom had also ceased soon thereafter,
Commonwealth Act No. 671 would have automatically ceased to have
force and effect right in the year 1942 without any affirmative act or law of
the Legislature. There would be no point or reason for the President to
continue exercising emergency powers when there no longer was any
emergency. But under the view of the majority, emergency or no
emergency even if Congress could meet in special session to enact
general legislation, the country must continue to be ruled by the
Presidential decree until the next regular session of Congress which may
not come till may months later. In my opinion this is not logical. To me the
real and only reason and test for the continuance of the exercise of
emergency powers is the continued existence of the emergency, not the
inability of the Congress to meet in regular session.
The majority, and the parties who initiated these proceedings in court fear
that the President may promulgate rules and regulations contrary in
purpose and effect to legislation enacted by the Legislature; that he may
reenact his rules and regulations after being repealed by the legislature,
and that he may even veto a bill passed by Congress repealing the Act of
delegation and ending his emergency powers. It is a fear not well
founded. It runs counter to the presumption that the Chief Executive like
any other public official would perform his functions and conduct himself
in every respect for the good and welfare of the people and in
accordance with the Constitution. It is fear based on the presumption that
the Legislature and the Chief Executive are at loggerheads, working at
cross purposes and that the President though acting as a mere agent of
his principal, the legislature, would brazenly repudiate his principal and
even challenge its authority, and that the Chief Executive is so much in
love with his emergency powers that he would perpetuate them by going
as far as vetoing an act of Congress ending said emergency powers. Let
it be said to the credit of and in justice to the different Chief Executives
who have wielded these emergency powers, President Quezon,
Osmeña, Roxas and the present incumbent President Quirino, that no
accusing finger has ever been pointed at them, accusing or even
insinuating that they have abused their emergency powers or exercised
them for any purpose other than the welfare of the country, or that they
had maliciously acted contrary to the wishes of the Legislatures. Even
after liberation there has been no claim not even from the Legislatures
itself, to the knowledge of this Court, at least to that of the undersigned,
that any Chief Executive exercised his delegated powers, knowing that
they had ended or had abused the same.
There is no charge or insinuation that any of the Executive Orders which
we are now holding to be invalid were issued from the ulterior motives or
to further and favor the political interest of the President issuing them. It
is admitted in the majority opinion that Executive Order No. 62, seeking
to regulate house and lot rentals was issued in good faith by President
Roxas. Executive Order No. 192 was issued to regulate exports,
President Quirino presumably believing that exports at this time still
needed regulation and control as was formerly provided by Congress in
its Act No. 728, and that the matter was still within the field of his
emergency powers as was also mistakenly believed by President Roxas
in issuing Executive Order No. 52. As to Executive Order No. 226, it
merely appropriated funds to defray the expenses in connection with the
holding of the national elections in November, 1949, without which, said
election could not be held. With respect to Executive Order No. 225, it
merely continues in force Republic Act 320 which appropriated funds for
the last fiscal year inasmuch as Congress had failed to pass a General
Appropriation Act for the operation of the National Government for the
period beginning July 1, 1949 to June 30, 1950. There is no insinuation
that any political motives or purposes are involved in these Executive
Orders.
I agree with the majority that since the Constitution provides that the
delegation of legislative powers by the Legislature should be done for a
limited period, it is to be presumed that Commonwealth Act No. 671 was
approved with this limitation in view. I even agree to its definition of the
word "limited." But I submit that Commonwealth Act No. 671 itself, limited
its operation and effectiveness to and make it coextensive with the
duration of the emergency resulting from the war and that furthermore,
that duration is a limited period within the meaning and contemplation of
the Constitution. Surely the emergency resulting from the war
contemplated by the National Assembly when it acted Act No. 671 is not
permanent or indefinite. It is of limited duration. It may be long or it may
be short; but it cannot be for always. It has an end. Presumably the
members of the National Assembly thought that the emergency would not
last as long as it did. The belief entertained at the time by not a few, in
fact by a great portion of the people here not excluding the legislators,
was that the war with Japan would be of short duration, a question of
months at the longest; that American reinforcements would come at the
beginning of the year 1942 and drive away the invading Japanese armies
if they ever were able to occupy the Philippines and that, consequently,
the war as far as these islands were concerned and the resulting
emergency would soon pass away. The wisdom or lack of wisdom of the
National Assembly in limiting or rather making the life and effectiveness
of Commonwealth Act No. 671 coextensive with the resulting emergency,
viewed in the light of what had actually happened, cannot be passed
upon this Court. So, as I see it, so long as the emergency resulting from
the War continues, Commonwealth Act No. 671 subsists and so long the
Chief Executive retains his emergency powers.
The majority believes that as already stated, Act No. 671 was in force
only until Congress could meet resume its legislatives functions.
Naturally, this view is based on the theory that legislative functions in
times of emergency are delegated only because of the inability of the
Legislative Department to meet and exercise its functions. I believe I
have successfully demonstrated the flaw in this theory, not only by
showing that the real reason underlying the delegation of legislative
powers is not inability of Legislature to meet but rather it inability to
consider and pass legislation in time to meet an emergency which
requires as it does urgent and immediate action and can be solved only
by the exercise of legislative functions by one single responsible
individual, unhamppered by study and prolonged discussion by many
members of the legislative body, but also by the fact that although since
1939 when the second world war broke out in Europe and for a period of
more than two years thereafter, when the National Assembly could still
meet and in fact convened on several occasions and for hundreds of
days in regular and special session, nevertheless, it had been delegating
legislative powers to the President.
The majority view finds no support in the law. Section 26, Article VI of the
Constitution does not impose this condition or requirement. The only
important conditions imposed by the Constitution are that there be a
national emergency and delegation be for a limited period. The same
thing is true with Act No. 671 which makes the delegation. The only
condition imposed by section 2 of said Act is that the delegated powers
be exercised during the emergency. Neither in the Constitution nor in
Commonwealth Act No. 671 is there any hint or insinuation, much less
express mention about the inability of the Legislature to meet. When
every consideration for clearness and for Executive and Judicial
guidance loudly called for and demanded an unequivocal and clear
expression of Constitutional and legislative intent, both laws, the source
and basis of the emergency powers are conspicuously silent on this
point. The only conclusion is that neither the framers of the Constitution
nor the members of the National Assembly had thought of much less
intended to impose this condition. To sustain the majority view would
require reading into the law what is not there. In further support of its view
that emergency powers may be exercised by the President only until the
Legislature could meet, the majority finds comfort in and cites section 3 of
Act 671 which reads as follows:
SEC. 3. The President of the Philippines shall as soon as
practicable upon the convening of the Congress of the Philippines
report thereto all the rules and regulation promulgated by him
under the powers herein granted.
I fail to see anything in said section that warrants a holding that upon
filing his report with Congress, about the rules and regulation
promulgated by him under his emergency powers under Commonwealth
Act 671, his emergency powers automatically ceased. I could well
imagine that under an act of delegation of legislative powers where the
President is authorized to perform one single act such as the suspension
of the eight-hour labor law under Commonwealth Act No. 494, or the
reduction of the expenditures of the executive departments of the
National Government by the suspension or abandonment of services,
activities or operations of no immediate necessity under Commonwealth
Act No. 500, when the President has exercised his delegated authority
and made his report to the Assembly as required by said laws, the latter,
as well as his delegated authority thereunder automatically ceased, for
the simple reason that nothing remains to be performed or done.
However, treating of the grant of extensive emergency powers as was
done under Commonwealth Acts Nos. 600, 620 and 671 where said laws
contemplated many different acts, rules and regulations of varied
categories and objectives and to be performed not at one at time or
instance but at different times during the existence of the emergency, as
the need or occasion arose, there is no reason for the belief or the
holding that upon submitting a partial report, the whole law making the
delegation including his powers under it automatically ended. The
legislature during the emergency might be able to convene and naturally,
the President will immediately make his report to it of the rules and
regulations promulgated by him up to that time; but if the emergency
continued or even became more serious, would it be reasonable to hold
that his emergency powers ended right then and there? Would it not be
more logical and reasonable to believe that inasmuch as the grant and
the exercise of his emergency powers were motivated by and based
upon the existence of the emergency and since the emergency continued
his work and responsibility were not ended and that his partial report
could not possibly affect the continuance of his emergency powers?
Section 3 of Commonwealth Act No. 671 provides for the filing of a report
with Congress by the President as soon as that body convened.
According to the majority opinion on that date the whole Act No. 671
ceased to have force and effect. Under that theory, as soon as the
Congress convened in June, 1945, and it is to be presumed that
President Osmeña, complying with his duty, must have made his report
of all the numerous Executive Orders he had issued so far, perhaps
including those issued by his predecessor President Quezon who
because of his premature death was unable to report his acts to
Congress, the President automatically lost his emergency powers. But
the majority opinion qualifies this convening of the Congress, for it says
that it must be a regular session and not a special session, thereby
extending the life of Commonwealth act No. 671 one year longer, to May,
1946 when Congress held its first regular session after liberation. I do not
quite see the necessity or the reason for the distinction made between
the special and regular session, for at both sessions Congress could well
receive the report of the President. The reason given is that "in a special
session Congress may consider general legislation or only such subjects
as he (President) may designate." But as a matter of fact, the first two
special sessions called by President Osmeña in 1945, after liberation,
each for a period of thirty days were both to consider general legislation.
So, actually there is no reason for the distinction.
Furthermore, if it were the intention of the Legislature to fix the time at
which Commonwealth Act No. 671 would cease in its operation as of the
date when the President could file his report before Congress when it first
convened not in special session but in regular session, it would have
expressly and unequivocally said so. In its other acts of delegation of
powers when the legislature wanted to have the report of the President at
its regular session, it expressly and explicitly said so. In section 3 of
Commonwealth Act 494, in section 5 of Commonwealth Act 496, in
section 6 of Commonwealth Act 498, in section 3 of Commonwealth Act
500 and in section 4 of Commonwealth Act 600, the National Assembly
provided that the President shall report to the National Assembly within
ten days after the opening of the next regular session of the said
Assembly of whatever acts have been taken by him under the authority of
those Acts. The Assembly left nothing for interpretation or speculation. In
section 3 of Commonwealth Act 671, however, the same Assembly has
not specified the kind of session before which the President should make
his report. It merely said that upon the convening of the Congress the
President shall report thereto all the rules and regulations promulgated by
him. We should make no distinction where the law makes or calls for
none. Here again, to support the majority opinion would require reading
into the law, section 3 of Act 671, something that is not there.
In case like the present where there is room for doubt as to whether or
not Commonwealth Act No. 671 has ceased to operate, one view (of the
majority) being that it automatically ceased to have any force and effect
on May 25, 1946, the other view being that the law operated as long as
the emergency resulting from the war existed, the opinion of and the
obvious interpretation given by the legislature which enacted the law and
made the delegation of powers and the President to whom the delegation
was made and who exercised said powers, should have much if not
decisive weight. We must bear in mind that we are not passing upon the
validity or constitutionality of a law enacted by the Legislature, in which
case, the Court may find the act invalid and unconstitutional if it is in
violation of the basic law, regardless of the opinion or interpretation given
by the Legislature that passed it or of the Executive Department which
may be trying to enforce it. We assume that Act No. 671 is valid and
constitutional. Here, we are merely trying to ascertain the intention of the
National Assembly as to the life and period of effectiveness of
Commonwealth Act No. 671.
Do the study and analysis of other acts of the Legislature similar to
Commonwealth Act 671, favor the view of the majority? The answer in
my opinion is clearly and decidedly in the negative. The majority cites the
Commonwealth Acts Nos. 600 and 620 to support the theory that
Commonwealth Act 671 automatically ceased to operate Congress met
at its next regular session. But the logical inference or conclusion to be
drawn from these two acts is, in my opinion, just the reverse. It is even
fatal to the view of the majority as I shall attempt to show. Let us consider
Commonwealth Act 600 delegating extensive legislative powers to the
President, approved on August 19, 1940, which like Act 671 is silent as to
any express provision regarding its life or period of effectiveness, and as
to how long the emergency powers granted the President by it will last.
Section 4 of said Commonwealth Act No. 600 like section 3 of Act 671
provides that "the President shall within the first ten days from the date of
the opening of the Assembly's next regular session report to said
Assembly whatever action he had taken under the authority therein
granted." Said section 4 of Act 600 is clearly and more specific than
section 3 of Act 671 in that it clearly specifies the next regular
session whereas the latter refers merely to the convening of Congress.
But let us assume arguendo as contended by the majority that "the
convening of the Congress" mentioned in section 3 of Commonwealth
Act 671, referred to regular session. According to the majority opinion,
under section 4 of the Commonwealth Act No. 600, as soon as the
President made the report of the National Assembly at its "next regular
session" which was to be and was actually held in January, 1941,
Commonwealth Act 600 automatically ceased to operate and the
President automatically lost his delegated legislative powers. But this
contrary to the very view of the National Assembly which passed said Act
600. Commonwealth Act No. 620 of the National Assembly passed
during that "next regular session" and approved on June 6, 1941 merely
amended section 1 of Commonwealth Act 600, which enumerated the
powers delegated to the Chief Executive. It left the rest of the provisions
and sections of Commonwealth Act 600 intact. So that, under section 4
(which was left intact) of Act 600, the President was still required to report
to National Assembly within the first 10 days from the date of the opening
of its next regular session which should have begun in January, 1942,
despite the fact that he had already made a report to the Legislature in
January, 1941. Incidentally, this answer and refutes the contention of the
majority that the law of delegation of powers contemplated only one
meeting of the Congress at which the President was to report his acts of
emergency, and that said report was to be the first and the last.
Now, what inference may be drawn from this amending of section 1 only
of Commonwealth Act No. 600 by Commonwealth Act No. 620? The
logical conclusion is that in promulgating Commonwealth Act 620 on
June 6, 1941, the National Assembly all along regarded Commonwealth
Act No. 600 which delegated legislative powers to the President as still in
force and effect despite the report filed with the Assembly by the
President at the beginning of its regular session in January, 1941. When
the Legislature merely amends a section of a law, leaving the rest of said
law intact and unchanged, the logical inference and conclusion is that the
amended law was still in force because you cannot amend a law which is
no longer in force. The only thing that could be done with a law that has
ceased to operate is to reenact it. But in passing Commonwealth Act 620
in July, 1941, the Assembly did not reenacted Commonwealth Act No.
600. By merely amending one of its sections, the Assembly, as late as
June 1941, considered said Act 600 as still effective and in operation and
consequently, the emergency powers of the President continued and
subsisted despite his previously having made a report of his actions in
January 1941. This squarely refutes the theory that as soon as the
President filed his report on the exercise of his emergency powers with
the Legislature, the Act making the delegation ceased to operate and the
President lost his emergency powers.
As I have already stated in the course of this opinion, in connection with
another phrase of this case from January to June, 1941, President
Quezon had issued at least eight Executive Orders in the exercise of his
emergency powers, by authority of Commonwealth Act 600. From this it
is evident that he did not share the majority view, because despite his
having made his report to the Assembly in January, 1941, and even
before the enactment of Commonwealth Act No. 620, he believed and
considered Commonwealth Act No. 600 as still in force after that date
and that he still retained his emergency powers.
Then, let us see what was the attitude and conduct of the Chief Executive
and of Congress after May 25, 1946, when according to the majority
opinion Commonwealth Act No. 671 ceased to operate. After May 25,
1946, two Presidents, Roxas and Quirino had issued numerous
Executive Orders based upon and invoking Commonwealth Act No. 671.
Like President Quezon, they also evidently were of the opinion that
despite the meeting of the Legislature in regular session the act
delegating legislative powers to them (in the case of Roxas and Quirino—
Commonwealth Act No. 671) was still in force, that they still retained their
emergency powers and so proceeded to exercise them in good faith.
Congress also, evidently, believed that Commonwealth Act No. 671 was
still in force and effect after said date, May 25, 1946. In spite of the
several legislative sessions, regular and special since then and up to and
including the year 1949, Congress has not by law or resolution said
anything questioning or doubting the validity of said Executive Order on
the score of having been promulgated after Commonwealth Act No. 671
had supposedly ceased to operate. Not only this, but at least in one
instance, Congress had by a law promulgated by it, considered one of
those supposed illegal Executive Orders promulgated after May 25,
1946, to be valid. I refer to Republic Act No. 224 approved on June 5,
1948, creating the National Airport Corporation which considered and
treated as valid Executive Order No. 100, dated October 21, 1947, by
providing in section 7 of said Republic Act No. 224 for the abolishment of
the Office of the Administrator of the Manila International Airport
established under the provisions of said Executive Order No. 100 and the
transfer of the personnel and funds created under the same Executive
Order to the National Airport Corporation. This Executive Order No. 100
which appropriated public funds and therefore, was of a legislative nature
must have been issued under Commonwealth Act No. 671. It cannot
possibly be regarded as having been promulgated by authority of
Republic Act No. 51, for said Act approved on October 4, 1946, gave the
President only one year within which to reorganize the different executive
departments, offices, agencies, etc. and Executive Order No. 100 was
promulgated on October 23, 1947, after the expiration of the one year
period. Furthermore, it is a matter of common knowledge that during the
last session of Congress which ended in May, 1949, there was talk if not
a movement in the Congress to end the emergency powers of the
President. Nothing concrete in the form of legislation or resolution was
done, for if we are to accept newspaper reports and comment, the
members of Congress or at least a majority of them were willing and
satisfied to have the Chief Executive continue in the exercise of his
emergency powers until the end of 1949. All this leads to no other
conclusion but that Congress believed all along that Commonwealth Act
No. 671 is still in force and effect.
If Commonwealth Act No. 671 is still in force and effect the question
arises: how long and for what period will said Act continue to operate? As
I have already stated, I believe that the delegation of emergency powers
was made coextensive with the emergency resulting from the war, as
long as that emergency continues and unless the Legislature provides
otherwise, Act 671 will continue to operate and the President may
continue exercising his emergency powers.
The last and logical question that one will naturally ask is: has the
emergency resulting from the war passed or does it still exist? This is a
fair and decisive question inasmuch as the existence of the emergency
is, my opinion, the test and the only basis of the operation or cessation of
Act 671. The existence or non-existence of the emergency resulting from
the war is a question of fact. It is based on conditions obtaining among
the people and in the country and perhaps even near and around it. It is
highly controversial question on which people may honestly differ. There
are those who in all good faith believe and claim that conditions have
returned to normal; that the people have now enough to eat, sometimes
even more than they had before the war; that people nowadays
especially in the cities are better nourished and clothed and transported
and better compensated for their labor, and that the President himself in
his speeches, chats and messages had assured the public that normal
times have returned, that the problem of peace and order had been
solved, that the finances of the Government and the national economy
are sound, and that there is an adequate food supply. It is therefore,
claimed that there is no longer any emergency resulting from the war.
On the other hand, it is asserted with equal vehemence in the opposite
camp that conditions are still far from normal; that the picture painted by
the President in cheerful and reassuring colors is based on over optimism
and, as to be expected, calculated to show in bold relief the
achievements of the administration, and so should be considered with
some allowance; that we are now importing more rice than before the war
for the reason that many rice farms are idle because of the farmer's fear
of or interference by dissidents; that the problem of peace and order is far
from solved as shown by the frequent hold-ups, kidnapping, loothing and
killings and organized banditry not only in Luzon but also in the Visayas
and Mindanao; that whereas before the war, the Constabulary force
consisting of only about 6,000 officers and men could provide complete
protection to life and property and was adequate in all respects to enforce
peace and order, now this Constabulary enlarged to about 20,000 men,
provided with modern weapons and equipment and with the aid of
thousands of civilians guards and of the Philippine Army and Air Force
cannot solve the peace and order problem; that the dissidents who are
well organized, armed and disciplined even attack and sack towns and
sometimes openly defy and engage the armed Government forces; that
as long as more than 100,000 firearms are loose and in the hands of
irresponsible parties, not excluding the seemingly regular mysterious
supply to them of additional firearms and ammunitions, there can be no
peace and order; and as to the barrio folks in central Luzon and now,
even in provinces bordering central Luzon whose parents and relatives
had been killed by dissidents, whose women folk had been outraged by
the same elements, whose homes had been looted and burned and
whose very lives had been subjected to constant terror and peril,
compelling them to leave their homes and their farms and evacuate to
and be concentrated in the poblaciones to live there in utter discomfort
and privation, it is said that it would be difficult to convince these
unfortunate people that normalcy has returned and that there is no longer
any emergency resulting from the war. To further support the claim of the
existence of an emergency, the menace of communism not only at home,
particularly in central Luzon but from abroad, especially China, is
invoked. And it is asserted that all this is a result of the war.
I repeat that this question of the existence of an emergency is a
controversial one, the decision on which must be based on the
ascertainment of facts, circumstances and conditions and the situation
obtaining in the country. This Court is not in a position to decide that
controversy. It does not have the facilities to obtain and acquire the
necessary facts and data on which to base a valid and just decision.
Neither did it have the opportunity to receive the necessary evidence as
in a hearing or trial at which evidence, oral or documentary, is introduced.
We cannot invoked and resort to judicial notice because this refers to
things of public knowledge, and not controverted, whereas things, facts
and conditions necessary for the determination of whether or not there is
still an emergency, are often not of public knowledge but require
investigation, accurate reporting and close contact with the people to be
able to ascertain their living conditions, their needs, their fears, etc.
To me, the department of the Government equipped and in a position to
decide this question of emergency are the Chief Executive and the
Legislature. The first has at his command and beck and call all the
executive officials and departments. He has the Army, the Constabulary,
Naval Patrol, the Police of the cities and towns and the barrio lieutenants
to inform him of the state of peace and order and the security of the
states. He has the Secretary of Education and all the subordinates
officers and the school officials under him to inform him as to whether or
not there is a school crisis or emergency as a result of the war. He has
the Secretary of Agriculture and Natural Resources and his men to
advise him as to the agricultural needs and the food supply of the
country. He has the Secretary of Finance and all the officials under him to
inform him of the finances of the Government and the economy of the
country as well as the officials to advise him of the land shipping
transportation situation. In other words, the President is in a position to
determine whether or not there is still an emergency as a result of the
war.
As to Congress, it is equally in a position and in fact it is the first to called
upon to decide as to the existence or non-existence of an emergency.
According to the Constitution, section 24, Article VI, either House of
Congress may call upon the head of any department of the Government
on any matter pertaining to his departure. The members of Congress
come from all parts and the far corners of the country. They are
supposed to be in close contact with their constituents and know at first
hand their needs, the way they live, etc. Congress therefore should know.
Moreover, it is the legislature that must first determine as to whether or
not there is a national emergency as a condition precedent to the
delegation of its legislative powers. Naturally, it is the one that is called
upon to say when that emergency ceases.
Now, one will ask, what does Congress think about the emergency?
Does it believe that it still exists? To me the answer is YES. What has
been said about the acts, conduct and attitude of the legislature as to its
belief that Commonwealth Act No. 671 is still in force, are all applicable
and may be repeated to show that the Congress believes that the
emergency resulting from the war still exist. Under the theory that I
maintain, Congress must be of the opinion that the emergency still exists
for the reason that as I have shown Congress believes that
Commonwealth Act No. 671 is still in force and the life and the operation
of said Act depends upon and is coextensive with the existence of the
emergency. To this may be added the attitude and the belief of the
President as to the continued existence of the emergency. It must be
borne in mind that Commonwealth Act No. 671 authorizes the President
to exercise his emergency powers only during the existence of the
emergency. The inference is that before exercising his emergency
powers by promulgating an Executive Order he must first determine and
decide that the state of emergency still exists, for that is the condition
precedent to the exercise of his delegated powers. In other words, the
two departments of the Government, the Legislative and the Executive
Departments, best qualified and called upon to determine whether or not
the emergency resulting from the war still exists have made manifest in
their acts and attitude that they believe that such emergency still exists. I
may here state that on this question of emergency, I entertain no
personal opinion either way lacking as I do the means of deciding fairly
and justly. Neither has the Court. If the decision of the courts on question
of fact involved in a controversy are given due respect and weight and
are binding, it is because such decisions are based on evidence adduced
and received after a hearing. No such hearing was held for the purpose
and no evidence been received. In other words, we have nothing in which
to decide a question of fact which is the existence or non-existence of
emergency.
In view of the conclusion we have arrived at, finding these Executive
Orders to be void and of no effect, particularly Executive Orders Nos. 225
and 226 with the evident result that no funds are appropriated for the
operation of the Government for the fiscal year beginning July of this year
and for the expenses in the coming national election next November, one
may inquire as to what will happen or what is to be done. The answer or
answers to this question lie with the Chief Executive. Congress will not
meet in regular session until next year. It is not for the court, not even the
undersigned to suggest the calling of a special legislative session to cope
with the perilous situation thus created, altho one may regard that as a
logical remedy. But, should the President call a special session and
Congress for one reason or another fails to meet or though it meets, for
one reason or another it fails to pass an appropriation law, then a real
crisis will have ensued. I am confident that the Chief Executive,
conscious of his responsibility as the Chief of the nation would not just
stand supine and idle and see the Government of the Republic of the
Philippines disintegrate and die. He would know what to do and he would
do something according to his sound discretion and in accordance with
the law, statutory or otherwise and in the discharge of his high executive
powers, express or implied.
TORRES, J., concurring:
I concur in the foregoing opinion of Mr. Justice Montemayor on the
existence of the emergency powers. I reserve my opinion on the validity
of Executive Orders Nos. 225 and 226.
REYES, J., concurring and dissenting:
The main issue in these cases is whether the emergency which on
December 16, 1941 prompted the approval of Commonwealth Act No.
671, delegating extraordinary powers to the President, still existed at the
time the Chief Executive exercised those powers by promulgating the
executive orders whose validity is now challenged.
On issue similar to the one just formulated there is a diversity of opinions.
While some courts would rather leave the determination of such issues to
the political department of the Government, others are for making the
determination subject to judicial review. But the latest ruling of the United
States Supreme Court on the point accords with first view and declares
that "these are matters of political judgment for which judges have neither
technical competence nor official responsibility." (Ludecke vs. Watkins,
92 L. ed., 1883.)
In any event the existence or non-existence of an emergency is a
question of facts which may not always be determine without the
evidence by mere reference to facts within the judicial notice. In the
present cases, there has been no trial for the reception of proof, and I am
not aware that enough facts have been shown to justify the conclusion
that the emergency in question has already ceased. On the other hand,
since the exercise of the emergency powers by the President
presupposes a determination of the existence of the emergency, the
President must be presumed to have satisfied himself in some
appropriate manner that the emergency existed when he issued his
executive orders. Under the theory of separation of powers and in accord
with the latest ruling of the United States Supreme Court, it is not for the
judiciary to review the finding of the Executive in this regard. Judicial
review would in such case amount to control of executive discretion and
place the judicial branch above a co-equal department of the
Government. Only in case of a manifest abuse of the exercise of powers
by a political branch of the Government is judicial interference allowable
in order to maintain the supremacy of the Constitution. But with the cold
war still going on though the shooting war has already ended; with the
world still in turmoil so much so that the American Secretary of the State
has declared that "the world has never before in peace time been as
troubled or hazardous as it is right now;" with most of the industries of the
country still unrihabilitated, so that a large proportion of our food and
other necessaries have to be imported; with a great portion of the
population still living in temporary quarters; with most of the war damage
claims still unpaid; and with peace and other conditions in the country far
from normal, it would be presumptuous for this Court, without proof of the
actual condition obtaining in all parts of the Archipelago, to declare that
the President clearly abused his discretion when he considered the
emergency not ended at the time he promulgated the executive orders
now questioned.
The majority opinion has skirted the issue of whether or not the question
of the existence or continuance of the emergency is one for the political
department of the Government to determine by restricting "the life of the
emergency powers of the President to the time the Legislature was
prevented from holding session due to enemy action or other causes
brought on by the war." I cannot subscribe to this narrow interpretation of
Commonwealth Act No. 671, for in my opinion it is contrary to both the
plain language and manifest purpose of that enactment. The law invests
the President with extraordinary powers in order to meet the emergency
resulting from the war and it expressly says that the President is to
exercise those powers "during the existence of the emergency." The Act
does not say that the President may exercise the powers only when the
Legislature is not session. Much less does it say that the emergency
powers shall cease as soon as the Legislature has convened in regular
session. An emergency resulting from a global war cannot end with the
mere meeting of the Legislature. Neither may be legislated out of
existence. The Legislature, once it was convened, may, if it so desire,
revoked the emergency powers of the President, but it cannot by any
form of legislative action put an immediate end to the emergency itself.
Well known is a fact that a deliverative body, such as the Legislature,
because of the time consumed in the study and discussion of a measure,
may not always act with the promptness which the situation requires so
that in an emergency there is really need for the concentration of power
in one man. This may well be the reason why Act No. 671 in express
terms authorizes the President to exercise the emergency powers "during
the existence of the emergency" and not merely during the time that the
Legislature could be in session. For one thing to make the life of the
emergency powers depend upon the inability of the Legislature to meet is
the same as to declare those emergency powers automatically ended the
moment they were conferred, for at that very moment of the Legislature
that conferred them was in session.
The argument that, unless the emergency powers of the President were
made to cease the moment Congress convened in regular session, we
should be having two legislatures which could mutually annul each other,
will not stand analysis. In supposing that the President, in the exercise of
the emergency powers could "repeal or modify a bill passed by the
Legislature," the argument overlooks the fact that the emergency powers
delegated to the President under Article VI, section 26 of the Constitution
could only authorize him "to promulgate rules and regulations to carry out
a declared national policy." Only the Legislature (with the concurrence of
the President of course) may declare the President may not, under the
Constitution, depart from it. Moreover, unless the Presidential veto could
be overriden, no bill approved by Congress could become a law if the
President did not want it. And if the President approves a bill and allows it
to become a law, surely he can have no reason for repealing it; while, on
the other hand, there is no point in his repealing that bill, because if there
are enough votes to override his veto there must also be enough votes to
repeal his emergency powers.
The majority opinion has I think placed a rather forced construction upon
section 3 of Commonwealth Act No. 671, which provides that —
The President of the Philippines shall as soon as practicable
upon the convening of the Congress of the Philippines report
thereto all the rules and regulations promulgated by him under
the powers herein granted.
As may be seen, the above provision does not say that the President has
to report only once, that is, the first time Congress is convened, and
never again. But the majority opinion wants to read that thought into the
law in order to bolster up the theory that the emergency powers of the
President would end as soon as Congress could convene in a regular
session.
Invoking the rule of contemporary construction, the majority opinion
makes reference to a passage in President Quezon's book. "The Good
Fight," to the effect that, according to the author, Act No. 671, was only
"for a certain period" and "would become valid unless re-enacted." But I
see nothing in the quoted phrases any suggestion that the emergency
powers of the President were to end the moment Congress was
convened in regular session regardless of the continuance of the
emergency which gave birth to those powers. A more valid application of
the rule of contemporary construction may, I think, be made by citing the
executive orders promulgated by President Roxas by Commonwealth Act
No. 671. Many of those executive orders were issued after May 25, 1946
when Congress convened in regular session, an event which, according
to the majority opinion, automatically put an end to the emergency
powers.
While we have adopted the republican form of government with its three
co-equal departments, each acting within its separate sphere, it would be
well to remember that we have not accepted the American theory of
separation of powers to its full extent. For, profiting from the experience
of America when her Supreme Court, by the application many a New
Deal measure which her Congress had approved to meet a national
crisis, our Constitutional Convention in 1935, despite the warning of
those who feared a dictatorship in his country, decided to depart from the
strict theory of separation of powers by embodying a provision in our
Constitution, authorizing the delegation of legislative powers to the
President "in times of war or other national emergency." It is my surmise
that this provision was intended to guard not only against the inability to
meet but also against its usual tardiness and inaction. We have proof of
this last in the last regular session of Congress, when this body failed to
pass measures of pressing necessity, especially the annual appropriation
law and the appropriation for the expenses of the coming elections.
It is said that the need for an appropriation law for the fiscal year 1949-
1950 as well for the coming elections is not an emergency resulting from
the war. But I say that if the emergency resulting from the war as
contemplated in Commonwealth Act No. 671 still exists, as the President
believes it exists or he would not have issued the executive orders in
question (and it is not for the Court to change that belief in the absence of
proof that the President was clearly wrong) would it not be a dereliction of
duty on his part to fall to provide, during the emergency, for the
continuance of the functions of government, which is only possible with
an appropriation law? What would be gained by issuing rules and
regulations to meet the emergency if there is no Government to enforce
and carry them out? The mere calling of a special is no guaranty that an
appropriation law will be passed or that one will be passed before the
thousands of officials and employees who work for the Government have
starved. It is, probably, because of these considerations that the National
Assembly, in approving Commonwealth Act No. 671, specifically
empowered the President, during the existence of the emergency, "to
continue in force laws and appropriations which would lapse or otherwise
become inoperative." And that Act has authorized the President during
the existence of the same emergency "to exercise such other powers as
he may deem necessary to enable the government to fulfill its
responsibilities and to maintain in force this authority." Under this specific
provision, the appropriation for the expenses of the coming elections
would, naturally, come, for, without doubt, it is a measure to enable the
Government "to fulfill its responsibilities."
Consistently with the views above express, I am of the opinion that
Executive Order No. 225, appropriating funds for the operation of the
Government of the Republic for the fiscal year 1949-50, and Executive
Order No. 226, appropriating funds for the expenses of the coming
national elections in November, 1949, are valid so that the petition in
G.R. No. L-3054, Eulogio Rodriguez, Sr. vs. Treasurer of the Philippines,
and the petition in G.R. No. L-3056, Antonio Barredo, etc., vs.
Commissioner on Election, et al., in which the said two executive orders
are respectively challenged, should be denied.
But Executive Order No. 62 (regulating rents) and Executive Order No.
192 (controlling exports) stand on a different footing. The validity of
Executive Order No. 62 can no longer be maintained because of the
approval by the Legislature of Commonwealth Act No. 689 and Republic
Act No. 66, which regulate the same subject matter and which, as an
expression of the national policy, can not be deviated from by the
President in the exercise of the emergency powers delegated to him by
Commonwealth Act No. 671. The same is true with respect to Executive
Order No. 192 (controlling exports) in view of the passage of
Commonwealth Act No. 728, regulating the same subject matter,
especially because section 4 of said Act terminates the power of the
President thereunder on December 31, 1948, if not sooner.
Consequently, since the validity of these executive orders (Nos. 62 and
192) can no longer be upheld, the petitions in G.R. Nos. L-2044, L-2756
and L-3055, which seek to prohibit their enforcement, should be granted.
PADILLA, J., concurring and dissenting:
I join in this opinion of Mr. Justice Reyes. I wish to add that I agree with
Mr. Justice Bengzon that petitioners in G. R. Nos. L-3054 and L-3056
have no personality to institute the proceedings.
BENGZON, J., dissenting:
The majority feels that it has to decide the question whether the
President still has emergency powers; but unable to determine in which
of the above cases the issue may properly be decided, it grouped them
together. When the eye or the hand is unsure, it is best to shoot at five
birds in a group: firing at one after another may mean as many misses.
It does not matter that the first two cases had been submitted and voted
before the submission of the last three. Neither does it matter that, of
these last, two should be thrown out in accordance with our previous
rulings. The target must be large.
These cases could be, and should be decided separately. If they are,
they may be disposed of without ruling on the general question whether
the President still has emergency powers under Commonwealth Act No.
7671. How? This way, which is my vote.
1. L-2044, Araneta vs. Dinglasan; L-2756, Araneta vs. Angeles. The
President has presently no power to regulate rents, because his power to
do so is granted by Commonwealth Acts Nos. 600 and 620 which have
lapsed. Under Commonwealth Act No. 671 he has no power to regulate
rents.
2. L-3056, Barredo vs. Commission, etc. Dismissed because petitioner
has no personality to sue. According to Custodio vs. President of the
Senate et al., 42 Off. Gaz., 1243, a citizen and taxpayer, as such, has no
legal standing to institute proceedings for the annulment of a statute.
3. L-3054, Rodriguez vs. Treasurer. Dismissed, like the Barredo case.
The private rights of petitioner and of his partymen are affected only as
taxpayers.
4. L-3055, Guerrero vs. Commissioner of Customs. Supposing that the
President still has emergency powers under Commonwealth Act No. 671,
and that they include regulation of exportation, inasmuch as the
Congress has chosen to legislate on exports (Commonwealth Act No.
728), it has thereby pro tanto withdrawn the power delegated to the
President along that field.
It is a sound rule, I believe, for the Court to determine only those
questions which are necessary to decide a case.
Although I am favorably impressed by the considerations set forth by Mr.
Justice Montemayor and Mr. Justice Reyes on the existence of
emergency powers, I prefer to vote as herein indicated.
I reserve the right subsequently to elaborate on the above propositions.
For lack of the required number of votes, judgment was not obtained.
However, after rehearing, the required number of votes was had, by
resolution of September 16, 1949, which follows.
RESOLUTION
September 16, 1949
MORAN, C. J.:
Petitioners filed motions asking (1) that Mr. Justice Padilla be qualified to
act in these cases; (2) that the vote cast by the late Mr. Justice Perpecto
before his death be counted in their favor; and (3) that the opinion of the
Chief Justice be counted as a vote for the nullity of Executive Orders
Nos. 225 and 226.
I
As regards the motion to disqualify Mr. Justice Padilla, the Court is of the
opinion that it must not be considered, it having been presented after Mr.
Justice Padilla had given his opinion on the merits of these cases. As we
have once said "a litigant . . . cannot be permitted to speculate upon the
action of the court and raise an objection of this sort after decision has
been rendered." (Government of the Philippine Islands vs. Heirs of
Abella, 49 Phil., 374.)
Furthermore, the fact that Justice Padilla, while Secretary of Justice, had
advised the President on the question of emergency powers, does not
disqualify him to act in these cases, for he cannot be considered as
having acted previously in these actions as counsel of any of the parties.
The President is not here a party.
All the members of this Court concur in the denial of the motion to
disqualify Mr. Justice Padilla, with the exception of Mr. Justice Ozaeta
and Mr. Justice Feria who reserve their vote.
II
With respect to the motion to include the vote and opinion of the late Mr.
Justice Perfecto in the decision of these cases, it appears that Mr. Justice
Perfecto died and ceased to be a member of this Court on August 17,
1949, and our decision in these cases was released for publication on
August 26, 1949. Rule 53, section 1, in connection with Rule 58, section
1, of the Rules of Court, is as follows:
SECTION 1. Judges: who may take part. — All matters submitted
to the court for its consideration and adjudication will be deemed
to be submitted for consideration and adjudication by any and all
of the justices who are members of the court at the time when
such matters are taken up for consideration and adjudication,
whether such justices were or not members of the court and
whether they were or were not present at the date of submission;
....
Under this provision, one who is not a member of the court at the time an
adjudication is made cannot take part in the adjudication. The word
"adjudication" means decision. A case can be adjudicated only by means
of a decision. And a decision of this Court, to be of value and binding
force, must be in writing duly signed and promulgated (Article VIII,
sections 11 and 12, of the Constitution; Republic Act No. 296, section 21;
Rule 53, section 7, of the Rules of Court). Promulgated means the
delivery of the decision to the Clerk of Court for filing and publication.
Accordingly, one who is no longer a member of this Court at the time a
decision is signed and promulgated, cannot validly take part in that
decision. As above indicated, the true decision of the Court is the
decision signed by the Justices and duly promulgated. Before that
decision is so signed and promulgated, there is no decision of the Court
to speak of. The vote cast by a member of the Court after deliberation is
always understood to be subject to confirmation at the time he has to
sign the decision that is to be promulgated. That vote is of no value if it is
not thus confirmed by the Justice casting it. The purpose of this practice
is apparent. Members of this Court, even after they have cast their vote,
wish to preserve their freedom of action till the last moment when they
have to sign the decision, so that they may take full advantage of what
they may believe to be the best fruit of their most mature reflection and
deliberation. In consonance with this practice, before a decision is signed
and promulgated, all opinions and conclusions stated during and after the
deliberation of the Court, remain in the breast of the Justices, binding
upon no one, not even upon the Justices themselves. Of course, they
may serve for determining what the opinion of the majority provisionally is
and for designating a member to prepare the decision binding unless and
until duly signed and promulgated.
And this is practically what we have said in the contempt case against
Abelardo Subido,1 promulgated on September 28, 1948:
que un asunto o causa pendiente en esta Corte Suprema solo se
considera decidido una vez registrada, promulgada y publicada la
sentencia en la escribania, y que hasta entonces el resultado de
la votacion se estima como una materia absolutamente
reservada y confidencial, perteneciente exclusivamente a las
camaras interiores de la Corte.
In an earlier case we had occasion to state that the decisive point is the
date of promulgation of judgment. In that case a judge rendered his
decision on January 14; qualified himself as Secretary of Finance on
January 16; and his decision was promulgated on January 17. We held
that the decision was void because at the time of its promulgation the
judge who prepared it was no longer a judge. (Lino Luna vs. Rodriquez,
37 Phil., 186.)
Another reason why the vote and opinion of the Mr. Justice Perfecto can
not be considered in these cases is that his successor, Mr. Justice
Torres, has been allowed by this Court to take part in the decision on the
question of emergency powers because of lack of majority on that
question. And Mr. Justice Torres is not bound to follow any opinion
previously held by Mr. Justice Perfecto on that matter. There is no law or
rule providing that a successor is a mere executor of his predecessor's
will. On the contrary, the successor must act according to his own opinion
for the simple reason that the responsibility for his action is his and of no
one else. Of course, where a valid and recorded act has been executed
by the predecessor and only a ministerial duty remains to be performed
for its completion, the act must be completed accordingly. For instance,
where the predecessor had rendered a valid judgment duly filed and
promulgated, the entry of that judgment which is a ministerial duty, may
be ordered by the successor as a matter of course. But even in that case,
if the successor is moved to reconsider the decision, and he still may do
so within the period provided by the rules, he is not bound to follow the
opinion of his predecessor, which he may set aside according to what he
may believe to be for the best interests of justice.
We are of the opinion, therefore, that the motion to include the vote and
opinion of the late Justice Perfecto in the decision of these cases must be
denied.
Mr. Justice Paras, Mr. Justice Bengzon, Mr. Justice Padilla, Mr. Justice
Montemayor, Mr. Justice Alex. Reyes, and Mr. Justice Torres concur in
this denial. Mr. Justice Ozaeta, Mr. Justice Feria and Mr. Justice Tuason
dissent.
III
In connection with the motion to consider the opinion of the Chief Justice
as a vote in favor of petitioners, the writer has the following to say:
In my previous concurring opinion, I expressed the view that the
emergency powers vested in Commonwealth Act No. 671 had ceased in
June 1945, but I voted for a deferment of judgment in these two cases
because of two circumstances then present, namely, (1) the need of
sustaining the two executive orders on appropriations as the life-line of
government and (2) the fact that a special session of Congress was to be
held in a few days. I then asked, "Why not defer judgment and wait until
the special session of Congress so that it may fulfill its duty as it clearly
sees it?"
It seemed then to me unwise and inexpedient to force the Government
into imminent disruption by allowing the nullity of the executive orders to
follow its reglementary consequences when Congress was soon to be
convened for the very purpose of passing, among other urgent
measures, a valid appropriations act. Considering the facility with which
Congress could remedy the existing anomaly, I deemed it a slavish
submission to a constitutional formula for this Court to seize upon its
power under the fundamental law to nullify the executive orders in
question. A deferment of judgment struck me then as wise. I reasoned
that judicial statesmanship, not judicial supremacy, was needed.
However, now that the holding of a special session of Congress for the
purpose of remedying the nullity of the executive orders in question
appears remote and uncertain, I am compelled to, and do hereby, give
my unqualified concurrence in the decision penned by Mr. Justice
Tuason declaring that these two executive orders were issued without
authority of law.
While in voting for a temporary deferment of the judgment I was moved
by the belief that the positive compliance with the Constitution by the
other branches of the Government, which is our prime concern in all
these cases, would be effected, and indefinite deferment will produce the
opposite result because it would legitimize a prolonged or permanent
evasion of our organic law. Executive orders which are, in our opinion,
repugnant to the Constitution, would be given permanent life, opening the
way to practices which may undermine our constitutional structure.
The harmful consequences which, as I envisioned in my concurring
opinion, would come to pass should the said executive orders be
immediately declared null and void, are still real. They have not
disappeared by reason of the fact that a special session of the Congress
is not now forthcoming. However, the remedy now lies in the hands of the
Chief Executive and of Congress, for the Constitution vests in the former
the power to call a special session should the need for one arise, and in
the latter, the power to pass a valid appropriation act.
That Congress may again fall to pass a valid appropriations act is a
remote possibility, for under the circumstances it fully realizes its great
responsibility of saving the nation from breaking down; and furthermore,
the President in the exercise of his constitutional powers may, if he so
desires, compel Congress to remain in special session till it approves the
legislative measures most needed by the country.
Democracy is on trial in the Philippines, and surely it will emerge
victorious as a permanent way of life in this country, if each of the great
branches of the Government, within its own allocated spear, complies
with its own constitutional duty, uncompromisingly and regardless of
difficulties.
Our Republic is still young, and the vital principle underlying its organic
structure should be maintained firm and strong, hard as the best of steel,
so as to insure its growth and development along solid lines of a stable
and vigorous democracy.
With my declaration that Executive Orders Nos. 225 and 226 are null and
void, and with the vote to the effect of Mr. Justice Ozaeta, Mr. Justice
Paras, Mr. Justice Feria, Mr. Justice Tuason and Mr. Justice
Montemayor, there is a sufficient majority to pronounce a valid judgment
on that matter.
It is maintained by the Solicitor General and the amicus curiae that eight
Justices are necessary to pronounce a judgment on the nullity of the
executive orders in question, under section 9 of Republic Act No. 296
and Article VIII, section 10 of the Constitution. This theory is made to rest
on the ground that said executive orders must be considered as laws,
they having been issued by the Chief Executive in the exercise of the
legislative powers delegated to him.
It is the opinion of the Court that the executive orders in question, even if
issued within the powers validly vested in the Chief Executive, are not
laws, although they may have the force of law, in exactly the same
manner as the judgments of this Court, municipal ordinances and
ordinary executive orders cannot be considered as laws, even if they
have the force of law.
Under Article VI, section 26, of the Constitution, the only power which, in
times of war or other national emergency, may be vested by Congress in
the President, is the power "to promulgate rules and regulations to carry
out a declared national policy." Consequently, the executive orders
issued by the President in pursuance of the power delegated to him
under that provision of the Constitution, may be considered only as rules
and regulations. There is nothing either in the Constitution or in the
Judiciary Act requiring the vote of eight Justices to nullify a rule or
regulation or an executive order issued by the President. It is very
significant that in the previous drafts of section 10, Article VII of the
Constitution, "executive order" and "regulation" were included among
those that required for their nullification the vote of two thirds of all of the
members of the Court. But "executive order" and "regulations" were later
deleted from the final draft (Aruego, The Framing of the Philippine
Constitution, Vol. I, pp. 495, 496), and thus a mere majority of six
members of this Court is enough to nullify them.
All the members of the Court concur in this view.
For all the foregoing, the Court denies the motion to disqualify Mr. Justice
Padilla, and the motion to include the vote of the late Mr. Justice Perfecto
in the decision of these cases. And it is the judgment of this Court to
declare Executive Orders Nos. 225 and 226, null and void, with the
dissent of Mr. Justice Bengzon, Mr. Justice Padilla and Mr. Justice
Reyes, upon the grounds already stated in their respective opinions, and
with Mr. Justice Torres abstaining.
But in order to avoid a possible disruption or interruption in a normal
operation of the Government, it is decreed, by the majority, of course,
that this judgment take effect upon the expiration of fifteen days from the
date of its entry. No costs to be charged.
Ozaeta, Paras, Bengzon, Padilla, Tuason, Montemayor, Reyes and
Torres, JJ., concur.
FERIA, J., concurring:
The respondent in the cases G. R. Nos. L-3054 and L-3056 contend that
the petitioners in said cases can not institute an action to invalidate the
Executive Orders Nos. 225 and 226 promulgated by the President,
because they have no interest in preventing the illegal expenditures of
moneys raised by taxation, and can not therefore question the validity of
said executive orders requiring expenditures of public money.
Although the Supreme Court, in the case of Custodio vs. President of the
Senate, G. R. No. L-117 (42 Off. Gaz., 1243) held in a minute resolution
"That the constitutionality of a legislative act is open to attack only by
person whose rights are affected thereby, that one who invokes the
power of the court to declare an Act of Congress to be unconstitutional
must be able to show not only that the statute is invalid, but that he has
sustained or is in immediate danger of sustaining some direct injury as
the result of its enforcement," that ruling was laid down without a careful
consideration and is contrary to the ruling laid down in the majority of
jurisdictions in the United States that "In the determination of the degree
of interest essential to give the requisite standing to attack the
constitutionality of a statute, the general rule is that not only persons
individually affected, but also have taxpayers, have sufficient interest in
preventing the illegal expenditures of money raised by taxation and may
therefore question the constitutionality of statutes requiring expenditures
of public moneys." (Am. Jur., Vol. 11, p. 761) All the members of this
Court, except two, in taking cognizance of those cases, rejected the
respondents' contention, reversed the ruling in said case and adopted the
general rule above mentioned; and we believe the latter is better than the
one adopted in said case of Custodio, which was based on a doctrine
adhered to only in few jurisdiction in the United States; because if a
taxpayer can not attack the validity of the executive orders in question or
a law requiring the expenditure of public moneys, one under our laws
could question the validity of such laws or executive orders.
After laying down the fundamental principles involved in the case at bar,
we shall discuss and show that Commonwealth Act No. 671 was no
longer in force at the time the Executive Orders under consideration were
promulgated, because even the respondents in the cases G. R. Nos. L-
2044 and L-2756, in sustaining the validity of the Executive Order No. 62
rely not only on Commonwealth Act No. 600 as amended by
Commonwealth Act No. 620, but on Commonwealth Act No. 671; and
afterwards we shall refute the arguments in support of the contrary
proposition that said Commonwealth Act No. 671 is still in force and,
therefore, the President may exercise now the legislative powers therein
delegated to him.
PRELIMINARY
The Constitution of the Philippines, drafted by the duly elected
representatives of the Filipino people, provides in its section 1, Article II,
that "The Philippines is a republican states, sovereignty resides in the
people and all government authority emanates from them." The people
have delegated the government authority to three different and separate
Departments: Legislative, Executive, and Judicial. In section 1, Article VI,
the legislative power to make laws is conferred upon Congress; the
executive power to faithfully executed the laws is vested by sections 1
and 10 of Article VII, in the President; and the judicial power is vested by
section 1, Article VII, in one Supreme Court and in such inferior courts as
may be established by law, the Supreme Court having the supremacy to
pass upon "the constitutionality or validity of any treaty, law, ordinance, or
executive order or regulations."
The distribution by the Constitution of the powers of government to the
Legislative, Executive, and Judicial Departments operates, by implication,
as an inhibition against the exercise by one department of the powers
which belong to another, and imposes upon each of the three
departments the duty of exercising its own peculiar powers by itself, and
prohibits the delegation of any of those powers except in cases expressly
permitted by the Constitution. The principle of the separation of the
powers of government is fundamental to the very existence of a
constitutional government as established in the Philippines patterned
after that of the United States of America. The division of governmental
powers into legislative, executive, and judicial represents the most
important principle of government that guarantees the liberties of the
people, for it prevents a concentration of powers in the hands of one
person or class of persons.
Under the doctrine of separation of the powers of government, the law-
making functions is assigned exclusively to the legislative, and the
legislative branch cannot delegate the power to make laws to any other
authority. But it must be borne in mind that what cannot be delegated is
that which is purely legislative in nature, not administrative. There are
powers so far legislative that may properly be exercised by the
legislature, but which may nevertheless be delegated because they may
be advantageously exercised in proper cases by persons belonging to
the other departments of the government, such as the authority to make
rules and regulations of administrative character to carry out an
legislative purposes or to effect the operation and enforcement of a law.
As illustrations of the proper exercise of the power of Congress to
delegate the authority to promulgate rules and regulations with the
necessary details to carry into effect a law, are Act No. 3155 empowering
the Governor General then, now the President, to suspend or not, at his
discretion, the prohibition of the importation of foreign cattle
(Cruz vs. Youngberg, 56 Phil., 234; Act No. 3106 authorizing the
Commissioner of the Public Service Commission to regulate those
engaged in various occupations or business affected with a public
interest, and to prescribe what the charges shall be for services rendered
in the conduct of such business (Cebu Autobus Co. vs. De Jesus, 56
Phil., 446); and the National Industrial Recovery Act enacted by the
Congress of the United States authorizing the President to promulgate
administrative rules and regulations to carry out the emergency measure
enacted by Congress, though a part thereof was declared
unconstitutional for producing a delegation of legislative authority which is
unconfined, "and not canalized within banks to keep it from ever flowing."
Athough, in principle, the power of the Legislature to make laws or
perform acts purely legislative in nature may only be delegated by
Congress to another authority or officers of either the executive or judicial
department when expressly permitted by the Constitution, no such
delegation is authorized by the State constitution or Federal Constitution
of the Untied States. It is a fact admitted by the attorneys and amici
curiae for the petitioners and respondents in these case that section 26,
Article VI, our Constitution is unique and has no counterpart in said
constitutions, and for that reason not a single case involving a question
similar to the one herein involved has never been submitted to and
passed upon by the courts of last resort in the United States. The
provision of our Constitution reads as follows:
SEC. 26. In times of war or other national emergency, the
Congress may by law authorize the President, for a limited period
and subject to such restrictions as it may prescribe, to promulgate
rules and regulations to carry out a declared national policy.
It is important to observe that what the above-quoted constitutional
provision empowers Congress to delegate to the President, is not the
power to promulgate rules and regulations of administrative nature, for
this may also be delegated at any time without necessity of an express
authority by the Constitution, but the power to promulgate rules and
regulations purely legislative in nature, leaving to the discretion of the
President the determination of what rules or regulations shall be or what
acts are necessary to effectuate the so-called declared national policy,
for otherwise it would not have been necessary for the Constitution to
authorize Congress to make such delegation.
DEMONSTRATION
The Constitution permits Congress to authorize the President of the
Philippines to promulgate rules and regulations of legislative nature only
(1) in times of war or (2) other national emergency, such as rebellion,
flood, earthquake, pestilence, economic depression, famine or any other
emergency different from war itself affecting the nation.
It is obvious that it is Congress and not a particular emergency and to
authorize the President to promulgate rules and regulations to cope with
it. Therefore, if Congress declares that there exist a war as a national
emergency and empowers the President to promulgate rules and
regulations to tide over the emergency, the latter could not, because he
believes that there is an economic emergency or depression or any
emergency other than war itself, exercise the legislative power delegated
to meet such economic or other emergency.
The Constitution requires also that the delegation be for a limited period
or other authority so delegated shall cease ipso facto at the expiration of
the period, because to require an express legislation to repel or terminate
the delegated legislative authority of the President might be subversive to
the constitutional separation of powers in out democratic form of
government, for the President my prevent indefinitely the repeal of his
delegated authority by the exercise of his veto power, since the veto
could be overridden only by two-thirds vote and it would be extremely
difficult to repeal it in subservient Congress dominated by the Chief
Executive. Besides, to provide that the delegated legislative powers shall
continue to exist until repealed by the Congress, would be delegation not
for limited, but for an unlimited period or rather without any limitation at
all, because all acts enacted are always subjects to repeal by the
Congress, without necessity to providing so.
No question is raised as to the constitutionality of Commonwealth Act No.
671 under which Executive Orders Nos. 62, 192, 225 and 226 were
promulgated by the President of the Philippines according to the
contention of the respondents. The question involved is the validity (not
constitutionality) of said executive orders, that is, whether or not the
President had authority to promulgate them under Commonwealth Act
No. 671; and therefore the concurrence of two-thirds of all the members
of this Court required by section 10, Article VIII of the Constitution to
declare a treaty or law unconstitutional is not required for adjudging the
executive orders in question invalid or not authorized by Commonwealth
Act No. 671, which read as follows:
COMMONWEALTH ACT NO. 671
AN ACT DECLARING A STATE OF TOTAL EMERGENCY AS A
RESULT OF WAR INVOLVING THE PHILIPPINES AND
AUTHORIZING THE PRESIDENT TO PROMULGATE RULES
AND REGULATIONS TO MEET SUCH EMERGENCY.
Be it enacted by the National Assembly of the Philippines:
SECTION 1. The existence of war between the United
States and other countries of Europe and Asia, which
involves the Philippines, makes it necessary to invest the
President with extraordinary powers in order to meet the
resulting emergency.
SEC. 2. Pursuant to the provisions of Article VI, section
16, of the Constitution, the President is hereby
authorized, during the existence of the emergency, to
promulgate such rules and regulations as he may deem
necessary to carry out the national policy declared in
section 1 hereof. Accordingly he is, among other things,
empowered (a) to transfer the seat of the Government or
any of its subdivisions, branches, departments, offices,
 agencies or instrumentalities; (b) to reorganize the
government of the Commonwealth including the
determination of the order of procedure of the heads of
the Executive Departments; (c) to create new
subdivisions, branches, departments, offices, agencies or
instrumentalities of Government and to abolish any of
those already existing; (d) to continue in force laws and
appropriations which would lapse or otherwise become
inoperative, and to modify or suspend the operation or
application of those of an administrative character; (e) to
impose new taxes or to increase, reduce, suspend, or
abolish those in existence; (f) to raise funds through the
issuance of bonds or otherwise, and to authorize the
expenditure of the proceeds thereof (g) to authorize the
National, provincial, city or municipal governments to
incur in overdrafts for purposes that he may approve; (h)
to declare the suspension of the collection of credits or
the payment of debts; and (i) to exercise such other
powers as he may deem necessary to enable the
Government to fulfill its responsibilities and to maintain
and enforce its authority.
SEC. 3. The President of the Philippines shall as soon as
practicable upon the convening of the Congress of the
Philippines report thereto all the rules and regulations
promulgated by him under the powers herein granted.
SEC. 4. This Act shall take upon its approval, and the
rules and regulations promulgated hereunder shall be in
force and effect until the Congress of the Philippines shall
otherwise provide.
Approved, December 16, 1941.
Taking into consideration the presumption that Congress was familiar
with the well-known limits of its powers under section 26, Article VI, of the
Constitution and did not intend to exceed said powers in enacting
Commonwealth Act No. 671, the express provisions of Commonwealth
Acts. Nos. 494, 496, 498, 499, 500, 600 as amended by 620 and 671,
and those of Commonwealth Act No. 689 as amended by Republic Act
No. 66 and Republic Acts Nos. 51 and 728, we are of the opinion, and
therefore so hold, that the actual war in the Philippine territory and not
any other national emergency is contemplated in Commonwealth Act No.
671, and that the period of time during which the President was
empowered by said Commonwealth Act No. 671 to promulgate rules and
regulations was limited to the existence of such war or invasion of the
Philippines by the enemy, which prevented the Congress to meet in a
regular session. Such emergency having ceased to exist upon the
complete liberation of the Philippines from the enemy's occupation,
Commonwealth Act No. 671 had ceased to be in force and effect at the
date of the adjournment of the next regular session of the Congress in
1946, before the promulgation of said executive orders, and hence they
are null and void.
In view of the existence of a state of national emergency caused by the
last world war among several nations of the world, the second National
Assembly during its second special session passed the following acts: (a)
Commonwealth Act No. 494 authorizing the President until the
adjournment of the next regular session of the National Assembly, to
suspend the operation of Commonwealth Act No. 444, commonly known
as the "Eight-Hour Labor-Law," when in his judgment the public interest
so required, in order to prevent a dislocation of the productive forces of
the country; (b) Commonwealth Act No. 496 delegating to the President
the power expressly granted by section 6, Article XIII, of the Constitution
to the State "until the date of adjournment of the next regular session of
the National Assembly, to take over solely for use or operation by the
Government during the existence of the emergency any public service or
enterprise and to operate the same," upon payment of just compensation;
(c) Commonwealth Act No. 498, authorizing the President, among others,
to fix the maximum selling prices of foods, clothing, fuel, fertilizers,
chemicals, building materials, implements, machinery, and equipment
required in agriculture and industry, and other articles or commodities of
prime necessity, and to promulgate such rules and regulations as he may
deem necessary in the public interest, which rules and regulations shall
have the force and effect of law until the date of the adjournment of the
next regular session of the National Assembly; (d) Commonwealth Act
No. 499 providing that until the date of the adjournment of the next
regular session of the National Assembly, any sale, mortgage, lease,
charter, delivery, transfer of vessels owned in whole or in part by a citizen
of the Philippines or by a corporation organizes under the laws of the
Philippines, to any person not a citizen of the United States or of the
Philippines, shall be null and void, without the approval of the President
of the Philippines; and Commonwealth Act No. 500 authorizing the
President to reduce the expenditure of the Executive Department of the
National Government by the suspension or abandonment of services,
activities or operations of no immediate necessity, which authority shall
be exercised only when the National Assembly is not in session. All these
Commonwealth Acts took effect upon their approval on September 30,
1939, a short time after the invasion of Poland by Germany.
During the fourth special session of the second National Assembly,
Commonwealth Act No. 600, which superseded the above-mentioned
emergency power acts, was passed and took effect on its approval on
August 19, 1940. This Act No. 600 expressly declared that the existence
of war in many parts of the world had created a national emergency
which made it necessary to invest the President with extraordinary
powers in order to safeguard the integrity of the Philippines and to insure
the tranquility of its inhabitants, by suppressing espionage, lawlessness,
and all supervise activities, by preventing or relieving unemployment, by
insuring to the people adequate shelter and clothing and sufficient food
supply, etc. To carry out this policy the President was "authorized to
promulgate rules and regulations which shall have the force and effect of
law until the date of adjournment of the next regular session of the
National Assembly," which rules and regulations may embrace the
objects therein enumerated. And the National Assembly in its regular
session commencing in January, 1941, in view of the fact that the
delegated authority granted to the President by Commonwealth Acts
Nos. 494, 496, 498, 500, and 600 was to terminate at the date of the
adjournment of that regular session of the National Assembly, passed Act
No. 620 which took effect upon its approval on June 6, 1941, amending
section 1 of Commonwealth Act No. 600 by extending the delegated
legislative authority of the President until the date of the adjournment of
the next regular session of the Congress of the Philippines, instead of the
National Assembly, the Constitution having been amended by
substituting the Congress of the Philippines for the National Assembly..
Although Commonwealth Act No. 600, as amended by Commonwealth
Act No. 620, provides that "the President is authorized to promulgate
rules and regulations which shall have the force and effect of law until the
date of adjournment of the next regular session of the Congress of the
Philippines," it is evident that this limitation was intended to apply, not
only to the effectivity of the rules and regulations already promulgated,
but specially to the authority granted to the President to promulgated
them, for the following reasons: First, because Commonwealth Act Nos.
494, 496, 498, 499, and 500 had expressly limited the authority of the
President to exercise the delegated power while the Assembly was not in
session until the date of the adjournment of the next regular session of
then National Assembly, and there was absolutely no reason whatsoever
why the National Assembly, in enacting Commonwealth Act No. 600 as
amended, which superseded said Act, would not impose the same
limitation on the authority delegated in Commonwealth Act No. 600 as
amended in compliance with the requirement of the Constitution;
secondly, because it would have been useless to give the rules and
regulations the effect and force of law only until the date of the
adjournment of the next regular session of the Congress, if the President
might, after said adjournment, continue exercising his delegated
legislative powers to promulgate again the same and other rules and
regulations; and lastly, because to construe Commonwealth Act No. 600,
as amended by Act No. 620, otherwise would be to make the delegation
not for a limited but for an indefinite period of time, in violation of the
express provision of section 26, Article VI of the Constitution.
All the above-mentioned Acts Nos. 494, 496, 499, 500, and 600 before its
amendment show that it was the intention or policy of the National
Assembly, in delegating legislative functions to the President, to limit the
exercise of the latter's authority to the interregnum while the National
Assembly or Congress of the Philippines was not in session until the date
of the adjournment of the next regular session thereof, which interregnum
might have extended over a long period of time had the war in Europe
involved and made the Philippines a battle ground before the next regular
session of the Congress had convened. And the authority granted to the
President of Commonwealth Act No. 600, as amended, had to be
extended over a long period of time during the occupation because,
before the meeting of the next regular session of the Congress, the
Philippines was involved in the war of the United States and invaded and
occupied by the Japanese forces. And the President was authorized to
exercise his delegated powers until the date of the adjournment of the
next regular session of the Congress, for the reason that although during
the next regular session a bill may be passed, by the Congress, it would
not become a law until it was approved, expressly or impliedly, by the
President during the period of twenty days after it shall have been
presented to him.
The reason of the limitation is that if Congress were in position to act it
would not be necessary for it to make such legislative delegation to the
President, for Congress may in all cases act, declare its will and, after
fixing a primary standard or yardstick, authorize the President to fill up the
details by prescribing administrative rules and regulations to cope with
the actual conditions of any emergency; and it is inconceivable that there
may arise an emergency of such a nature that would require immediate
action and can not wait, without irreparable or great injury to the public
interest, and action of the legislative in regular or special session called
by the Chief Executive for the purpose of meeting it. If in the United
States they could withstand and have withstood all kinds of emergency
without resorting to the delegation by the legislative body of legislative
power to the Executive except those of administrative nature, because no
such delegation is permitted by the States and Federal constitution, as
above stated, there is no reason why the same can not be done in the
Philippines. The frames of our Constitution and the national Assembly
that enacted Commonwealth Act No. 671 are presumed to be aware of
the inconvenience and chaotical consequences of having two legislative
bodies acting at one and the same time.
It is true that Commonwealth Act No. 671 does not expressly say that the
President is authorized to promulgates rules and regulations until the
date of the adjournment of the next regular session of the National
Assembly or Congress as the above-quoted Commonwealth Acts; but it
is also true that it clearly provides that "pursuant to the provisions of
Article VI, section 26, of the Constitution, the President is hereby
authorized, during the existence of the emergency, to promulgate such
rules and regulations as he may deem necessary to carry out the national
policy declared"; and that the definite and specific emergency therein
referred to is no other that the "state of total emergency as a result of war
involving the Philippines", declared in the title of said Act No. 671, that
was the reason for which the President was "authorize to promulgate
rules and regulations to meet resulting emergency." It is obvious that
what Act No. 671 calls "total emergency" was the invasion and
occupation of the Philippines by the enemy or Japanese forces which, at
the time of the passage and approval of said Act, had already landed in
Philippine soil and was expected to paralyze the functioning of the
Congress during the invasion and enemy occupation of the Philippines.
The mere existence of the last world war in many parts of the world which
had created a national emergency made it necessary to invest the
President with extraordinary powers was not called total emergency by
Commonwealth Act Nos. 600 and 620, because it had not yet actually
involved and engulfed the Philippines in the maelstrom of war. It does not
stand to reason that the authority given to the President to promulgate
rules and regulations of legislative nature by Commonwealth Acts Nos.
494, 496, 498, 499, 500, 600 and 620 was to terminate at the date of the
adjournment of the next regular session of the Congress of the
Philippines in 1946, but those granted to the President by
Commonwealth Act No. 671 under the same war emergency should
continue to exist indefinitely even after the Congress of the Philippines
had regularly convened, acted, and adjourned in the year 1946 and
subsequent years. Besides to give such construction to Act No. 671
would make it violative of the express provision of section 26, Article VIII,
of the Constitution, under which said Commonwealth Act No. 671 was
enacted, as expressly stated in said Act, and which permits the Congress
to authorize the President, only for a limited period during a war
emergency, to promulgate rules and regulations to carry into effect a
declared national policy.
By the special session of the first Congress of the Philippines
commencing on the 9th day of June, 1945, called by the President for the
purpose of considering general legislation, Commonwealth Act No. 671
did not cease to operate. As we have already said, the emergency which
prompted the second National Assembly to enact Commonwealth Act
No. 671 delegating legislative powers to the President, was the inability
of Congress to convene in regular session in January of every during the
invasion of the Philippines by the Japanese Imperial forces. The National
Assembly could not have in mind any special session which might have
been called by the President immediately after liberation, because the
calling of a special session as well as the matters which may be
submitted by the President to Congress for consideration is a contingent
event which depend upon the possibility of convening it and the
discretion of the President to call it, and the matters he will submit to it for
consideration; because it is to be presumed, in order to comply with the
provision of section 26, Article VI of the Constitution, that it was the
intention of the National Assembly to fix a limited period, independent of
the President's will, during which he is authorized to exercise his
delegated legislative power.
The object of section 3 of Act No. 671 in requiring the President to report
"as soon as practicable upon the convening of the Congress of the
Philippines all rules and regulations promulgated by him under the
powers therein granted" is to inform the Congress of the contents of said
rules and regulations so that the latter may modify or repeal them if it
sees fit to do so, inasmuch as, according to section 4 of the same Act,
"the rules and regulations promulgated hereunder shall be in force and
effect until the Congress shall otherwise provide." And although said
section 3 does not specify whether in regular or special session, it is
evident that it refers to the next regular and not to the special session of
the Congress, because as a rule a special session is called to consider
only specific matters submitted by the President to Congress for
consideration, and it would be useless to submit such report to the
Congress in special session if the latter can not either modify or repeal
such rules and regulations; and besides, it is to be presumed that it was
the intention of the National Assembly in enacting section 3 of
Commonwealth Act No. 671 to require the submission of a report to the
next regular session of the Assembly or Congress, as provided in section
4 Commonwealth Act No. 600, as amended by Commonwealth Act No.
620, which required a similar report, for there was absolutely no plausible
reason to provide otherwise.
Our conclusion is corroborated by the fact that section 3 of Act No. 671
only requires the President to submit the report, "as soon as practicable
upon the convening of the Congress" and not to submit a report to the
Congress every time it convenes, in order to inform the Congress thereof
so that the latter may modify or repeal any or all of them, for under
section 4 of the same Act "such rules and regulations shall continue in
force and effect until the Congress shall otherwise provide." It is obvious
that the convening of the Congress referred to in said section 3 is the
next regular session of the Congress after the passage of Act No. 671,
and not any other subsequent session; because, otherwise, it would not
have required that it shall be submitted to the Congress as soon as
practicable and the purpose of the law already stated in requiring the
submission of the report would be defeated; and if it were the intention of
said Commonwealth Act No. 671 to authorize the President to continue
promulgating rules and regulations after the next regular session of the
Congress, it would have required the President to submit to the Congress
each and every time it convenes a report of the rules and regulations
promulgated after his previous reports had been submitted.
Furthermore, our conclusion is confirmed by the legislative interpretation
give to Commonwealth Act No. 671 by the same Congress in enacting
Commonwealth Act No. 728 which took effect on July 2, 1946,
authorizing the President to regulate, control, curtail, and prohibit the
exploration of agricultural or industrial products, merchandise, articles,
materials and supplies without the permit of the President until December
31, 1948 as expressly provided in section 4 thereof, because it would not
have been necessary for the Congress to promulgate said Act No. 728 if
the President had authority to promulgate Executive Order No. 62 in
question on January 1, 1949, under Commonwealth Act No. 671 as
contended by the respondents; and Republic Act No. 51, approved on
October 4, 1946, authorizing within one year the different executive
departments, business, offices, agencies and other instrumentalities of
the government, including corporations controlled by it, would not have
been passed by the Congress if Commonwealth Act No. 671 under
consideration was then still in force, for section 2 (b) and (c) of said Act
No. 671 authorizes the President to reorganize the Government and to
create new subdivisions, branches, department offices, agencies or
instrumentalities of government, and to abolish any of those already
existing.
REPUTATION
There is no force in the argument that the executive orders in question
are not valid, not because the promulgation of the acts above mentioned
and of Commonwealth Act No. 689 as amended by the Republic Act No.
66 on rentals, the appropriation acts or Republic Act Nos. 1, 156, and
320 for the years 1946-47, 1947-48 and 1948-49, and of the Republic
Acts Nos. 73, 147, and 235 appropriating public finds to defray the
expenses for the elections held in 1947 and 1948, shows that the
emergency powers granted by Commonwealth Act No. 671 had already
ceased to exist, but because Congress "has shown by their enactment its
readiness and ability to legislate on those matters, and had withdrawn it
from the realm of presidential legislation or regulations under the powers
delegated by Commonwealth Act No. 671." If the Congress was ready
and able to legislate on those matters since 1946 and for that reason the
executive orders herein involved are null and void, there is no valid
reason for not concluding that the emergency powers of the President
has ceased to exist it did not, legislate on all matters on which the
President was granted and delegated power to legislate by the
Commonwealth Act No. 671. And if Commonwealth Act No. 671
continues to be in force and effect in so far as it grants delegated
legislative powers to the President and declares the national policy to be
carried out by the rules and regulations the President is authorize to
promulgate, the mere promulgation of the acts above described can not
be considered as an implied repeal or withdrawal of the authority of the
President to promulgates rules and regulations only on those matters,
and the adoption of a contrary policy by the Congress, because implied
repeal is not favored in statutory construction, and the national policy
referred to in section 26, Article VIII of the Constitution is to be declared
by the Congress in delegating the legislative powers to the President, in
order to establish the standard to be carried out by him in exercising his
delegated functions, and not in repealing said powers.
As we have already said, section 26, Article VI of the Constitution
expressly empowers Congress, in times of war and other national
emergency, to authorize the President to promulgate rules and
regulations to carry out a declared national policy, and therefore it is for
the National Assembly to determine the existence of a particular
emergency declare the national policy, and authorize the President to
promulgate rules and regulations of legislative nature to carry out that
policy. As the Commonwealth Act No. 671 that the existence of
war between the United States and other countries of Europe and Asia
which involves the Philippines is the emergency which made it necessary
for the National Assembly to invest the President with extraordinary
powers to promulgate rules and regulations to meet the resulting
emergency from the actual existence of that war which involved the
Philippines, the President cannot, under said Act No. 671, determine the
existence of any other emergency, such as the state of cold war, the
continued military occupation of the enemy country, and the economic
and political instability throughout the world, cited by the respondents,
and promulgate rules and regulations to meet the emergency; because
obviously it is not for the delegate but for the delegation to say when and
under what circumstances the former may act in behalf of the latter, and
not vice-versa.
The theory of those who are of the opinion that the President may
determine "whether the emergency which on December 16, 1941,
prompted the approval of Commonwealth Act No. 671 delegating
extraordinary powers to the President, still existed at the time the Chief
Executive exercised those powers," is predicated upon the erroneous
assumption that said Commonwealth Act No. 671 contemplated any
other emergency not expressly mentioned in said Commonwealth Act.
This assumption or premise is obviously wrong. Section 1 of said Act No.
671 expressly states that "the existence of the war between the United
States and other countries of Europe and Asia which involves the
Philippines makes it necessary to invest the President with extraordinary
power in order to meet the resulting emergency." That is the war
emergency. Ant it is evident, and therefore no evidence is requires to
prove, that the existence of the war which involved the Philippines had
already ceased before the promulgation of the executive orders in
question, or at least, if the last war has not yet technically terminated in
so far as the United States is concerned, it did no longer involve the
Republic of the Philippines since the inauguration of our Republic or
independence from the sovereignty of the United States.
It is untenable to contend that the words "resulting emergency from the
existence of the war" as used in section 1 of Commonwealth Act No. 671
should be construed to mean any emergency resulting from or that is the
effect of the last war, and not the war emergency itself, and that therefore
it is for the President to determine whether at the time of the
promulgation of the executive orders under consideration such
emergency still existed, because such contention would make Act No.
671 unconstitutional or violative of the provisions of section 26, Article VI
of the Constitution. This constitutional precept distinguishes war
emergency from any other national emergency, such as an economic
depression and others which may be the effect of a war, and empowers
the Congress in times of war and other national emergency, to be
determined by Congress itself as we have already said and shown, to
authorize the President, for a limited period that may short or of the same
duration but not longer than that of the emergency, to promulgate rules
and regulations to carry out the policy declared by the Congress in order
to meet the emergency. To construe Commonwealth Act No. 671 as
contended would be to leave the determination of the existence of the
emergency to the discretion of the President, because the effects of the
war such as those enumerated by the respondents are not determined or
stated in said Act and could not have been foreseen by the Assembly in
enacting said Act; and because it would make the delegation of powers
for an in definite period, since such an emergency may or may not
become depression, effect of the first world war, took place in the year
1929, or about ten years after the cessation of hostilities in the year 1919;
and by no stretch of imagination or intellectual gymnastics may the failure
of the Congress to appropriate funds for the operation of the Government
during the period from July 1, 1949 to June 30, 1950, and to defray the
expenses in connection with the holding of the national election on the
second Tuesday of November, 1949, be considered as an emergency
resulting from the last war.
In the enactment of emergency police measures, the questions
as to whether an emergency exists is primarily for the legislature
to determine. Such determination, although entitled to great
respect, is not conclusive because the courts, in such cases,
posses the final authority to determine whether an emergency in
fact exists. (American Jurisprudence, Vol. XI, page 980.).
No case decided by the courts of last resort in the United States may be
cited in support of the proposition that it is for the President to determine
whether there exist an emergency in order to exercise his emergency
powers, and "it is not for the judiciary to review the finding of the
Executive in this regard." There is none and there cannot be any.
Because, as we have already stated at the beginning of this opinion, and
we are supported by the above quotation from American Jurisprudence,
the power to pass emergency police legislation in the United States may
be exercised only by the legislature in the exercise of the police power of
the State, and it can not be delegated to the Executive because there is
no provision in the State and Federal constitutions authorizing such
delegation as we have in section 26, Article VI, of our Constitution. As we
have already said before, the only legislative power which may be
delegated to the Executive and other administrative bodies or officers in
the United States is the power to promulgate rules and regulations of
administrative nature, which does not include the exercise of the police
power of the State.
The ruling laid down by the United States Supreme Court in the case
of Ludecke vs. Watkins, 92 Law ed., 1883, quoted by the respondents
and dissenters in support of the proposition that "only in case of a
manifest abuse of the exercise of powers by a political branch of the
government is judicial interference allowable in order to maintain the
supremacy of the Constitution," has no application to the present case;
because the question involved in the present case is not a political but a
justiciable question, while the question in issue in said Ludecke case was
the power of the court to review "the determination of the President in the
postwar period that an alien enemy should be deported, even though
active hostilities have ceased," and it was held that it was a political
question and, therefore, was not subject to judicial review.
CONCLUSION
In view of all the foregoing, we have to conclude and declare that the
executive orders promulgated by the President under Commonwealth Act
671 before the date of the adjournment of the regular session of the
Congress on the Philippines in 1946 are valid, because said
Commonwealth Act was then still in force; but the executive orders
promulgated after the said date are null and void, because
Commonwealth Act No. 671 had already ceased to be in force in so far
as the delegation of powers was concerned. Therefore, are null and void
the Executive Order No. 192 promulgated on December 24, 1948, on the
control of exports from the Philippines; the Executive Order No. 225
dated June 15, 1949, appropriating funds for the operation of the
Government of the Republic of the Philippines during the period from July
1, 1949 to June 30, 1950; and the Executive Order No. 226 promulgated
on June 15, 1949, appropriating the sum of six million pesos to defray the
expenses in connection with, and incidental to, the holding of the national
election to be held on the second Tuesday of November, 1949.
G.R. No. 171396 May 3, 2006
PROF. RANDOLF S. DAVID, LORENZO TAÑADA III, RONALD
LLAMAS, H. HARRY L. ROQUE, JR., JOEL RUIZ BUTUYAN, ROGER
R. RAYEL, GARY S. MALLARI, ROMEL REGALADO BAGARES,
CHRISTOPHER F.C. BOLASTIG, Petitioners,
vs.
GLORIA MACAPAGAL-ARROYO, AS PRESIDENT AND
COMMANDER-IN-CHIEF, EXECUTIVE SECRETARY EDUARDO
ERMITA, HON. AVELINO CRUZ II, SECRETARY OF NATIONAL
DEFENSE, GENERAL GENEROSO SENGA, CHIEF OF STAFF,
ARMED FORCES OF THE PHILIPPINES, DIRECTOR GENERAL
ARTURO LOMIBAO, CHIEF, PHILIPPINE NATIONAL
POLICE, Respondents.
x-------------------------------------x
G.R. No. 171409 May 3, 2006
NIÑEZ CACHO-OLIVARES AND TRIBUNE PUBLISHING CO.,
INC., Petitioners,
vs.
HONORABLE SECRETARY EDUARDO ERMITA AND HONORABLE
DIRECTOR GENERAL ARTURO C. LOMIBAO, Respondents.
x-------------------------------------x
G.R. No. 171485 May 3, 2006
FRANCIS JOSEPH G. ESCUDERO, JOSEPH A. SANTIAGO,
TEODORO A. CASINO, AGAPITO A. AQUINO, MARIO J. AGUJA,
SATUR C. OCAMPO, MUJIV S. HATAMAN, JUAN EDGARDO
ANGARA, TEOFISTO DL. GUINGONA III, EMMANUEL JOSEL J.
VILLANUEVA, LIZA L. MAZA, IMEE R. MARCOS, RENATO B.
MAGTUBO, JUSTIN MARC SB. CHIPECO, ROILO GOLEZ, DARLENE
ANTONINO-CUSTODIO, LORETTA ANN P. ROSALES, JOSEL G.
VIRADOR, RAFAEL V. MARIANO, GILBERT C. REMULLA,
FLORENCIO G. NOEL, ANA THERESIA HONTIVEROS-BARAQUEL,
IMELDA C. NICOLAS, MARVIC M.V.F. LEONEN, NERI JAVIER
COLMENARES, MOVEMENT OF CONCERNED CITIZENS FOR CIVIL
LIBERTIES REPRESENTED BY AMADO GAT INCIONG, Petitioners,
vs.
EDUARDO R. ERMITA, EXECUTIVE SECRETARY, AVELINO J. CRUZ,
JR., SECRETARY, DND RONALDO V. PUNO, SECRETARY, DILG,
GENEROSO SENGA, AFP CHIEF OF STAFF, ARTURO LOMIBAO,
CHIEF PNP, Respondents.
x-------------------------------------x
G.R. No. 171483 May 3, 2006
KILUSANG MAYO UNO, REPRESENTED BY ITS CHAIRPERSON
ELMER C. LABOG AND SECRETARY GENERAL JOEL
MAGLUNSOD, NATIONAL FEDERATION OF LABOR UNIONS –
KILUSANG MAYO UNO (NAFLU-KMU), REPRESENTED BY ITS
NATIONAL PRESIDENT, JOSELITO V. USTAREZ, ANTONIO C.
PASCUAL, SALVADOR T. CARRANZA, EMILIA P. DAPULANG,
MARTIN CUSTODIO, JR., AND ROQUE M. TAN, Petitioners,
vs.
HER EXCELLENCY, PRESIDENT GLORIA MACAPAGAL-ARROYO,
THE HONORABLE EXECUTIVE SECRETARY, EDUARDO ERMITA,
THE CHIEF OF STAFF, ARMED FORCES OF THE PHILIPPINES,
GENEROSO SENGA, AND THE PNP DIRECTOR GENERAL, ARTURO
LOMIBAO, Respondents.
x-------------------------------------x
G.R. No. 171400 May 3, 2006
ALTERNATIVE LAW GROUPS, INC. (ALG), Petitioner,
vs.
EXECUTIVE SECRETARY EDUARDO R. ERMITA, LT. GEN.
GENEROSO SENGA, AND DIRECTOR GENERAL ARTURO
LOMIBAO, Respondents.
G.R. No. 171489 May 3, 2006
JOSE ANSELMO I. CADIZ, FELICIANO M. BAUTISTA, ROMULO R.
RIVERA, JOSE AMOR M. AMORADO, ALICIA A. RISOS-VIDAL,
FELIMON C. ABELITA III, MANUEL P. LEGASPI, J.B. JOVY C.
BERNABE, BERNARD L. DAGCUTA, ROGELIO V. GARCIA AND
INTEGRATED BAR OF THE PHILIPPINES (IBP), Petitioners,
vs.
HON. EXECUTIVE SECRETARY EDUARDO ERMITA, GENERAL
GENEROSO SENGA, IN HIS CAPACITY AS AFP CHIEF OF STAFF,
AND DIRECTOR GENERAL ARTURO LOMIBAO, IN HIS CAPACITY
AS PNP CHIEF, Respondents.
x-------------------------------------x
G.R. No. 171424 May 3, 2006
LOREN B. LEGARDA, Petitioner,
vs.
GLORIA MACAPAGAL-ARROYO, IN HER CAPACITY AS PRESIDENT
AND COMMANDER-IN-CHIEF; ARTURO LOMIBAO, IN HIS
CAPACITY AS DIRECTOR-GENERAL OF THE PHILIPPINE
NATIONAL POLICE (PNP); GENEROSO SENGA, IN HIS CAPACITY
AS CHIEF OF STAFF OF THE ARMED FORCES OF THE
PHILIPPINES (AFP); AND EDUARDO ERMITA, IN HIS CAPACITY AS
EXECUTIVE SECRETARY, Respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
All powers need some restraint; practical adjustments rather than rigid
formula are necessary.1 Superior strength – the use of force – cannot
make wrongs into rights. In this regard, the courts should be vigilant in
safeguarding the constitutional rights of the citizens, specifically their
liberty.
Chief Justice Artemio V. Panganiban’s philosophy of liberty is thus most
relevant. He said: "In cases involving liberty, the scales of justice
should weigh heavily against government and in favor of the poor,
the oppressed, the marginalized, the dispossessed and the weak."
Laws and actions that restrict fundamental rights come to the courts "with
a heavy presumption against their constitutional validity." 2
These seven (7) consolidated petitions for certiorari and prohibition allege
that in issuing Presidential Proclamation No. 1017 (PP 1017) and
General Order No. 5 (G.O. No. 5), President Gloria Macapagal-Arroyo
committed grave abuse of discretion. Petitioners contend that respondent
officials of the Government, in their professed efforts to defend and
preserve democratic institutions, are actually trampling upon the very
freedom guaranteed and protected by the Constitution. Hence, such
issuances are void for being unconstitutional.
Once again, the Court is faced with an age-old but persistently modern and sabotaging the people’s confidence in government and their
problem. How does the Constitution of a free people combine the degree faith in the future of this country;
of liberty, without which, law becomes tyranny, with the degree of law,
without which, liberty becomes license?3 WHEREAS, these actions are adversely affecting the economy;

On February 24, 2006, as the nation celebrated the 20th Anniversary of WHEREAS, these activities give totalitarian forces of both the
the Edsa People Power I, President Arroyo issued PP 1017 declaring a extreme Left and extreme Right the opening to intensify their
state of national emergency, thus: avowed aims to bring down the democratic Philippine State;

NOW, THEREFORE, I, Gloria Macapagal-Arroyo, President of the WHEREAS, Article 2, Section 4 of the our Constitution makes the
Republic of the Philippines and Commander-in-Chief of the Armed defense and preservation of the democratic institutions and the State the
Forces of the Philippines, by virtue of the powers vested upon me by primary duty of Government;
Section 18, Article 7 of the Philippine Constitution which states that: "The
President. . . whenever it becomes necessary, . . . may call out (the) WHEREAS, the activities above-described, their consequences,
armed forces to prevent or suppress. . .rebellion. . .," and in my capacity ramifications and collateral effects constitute a clear and present
as their Commander-in-Chief, do hereby command the Armed Forces danger to the safety and the integrity of the Philippine State and of the
of the Philippines, to maintain law and order throughout the Filipino people;
Philippines, prevent or suppress all forms of lawless violence as
well as any act of insurrection or rebellion and to enforce obedience
On the same day, the President issued G. O. No. 5 implementing PP
to all the laws and to all decrees, orders and regulations
1017, thus:
promulgated by me personally or upon my direction; and as
provided in Section 17, Article 12 of the Constitution do hereby
declare a State of National Emergency. WHEREAS, over these past months, elements in the political opposition
have conspired with authoritarians of the extreme Left, represented by
the NDF-CPP-NPA and the extreme Right, represented by military
She cited the following facts as bases:
adventurists - the historical enemies of the democratic Philippine State –
and who are now in a tactical alliance and engaged in a concerted and
WHEREAS, over these past months, elements in the political systematic conspiracy, over a broad front, to bring down the duly-
opposition have conspired with authoritarians of the extreme Left constituted Government elected in May 2004;
represented by the NDF-CPP-NPA and the extreme Right,
represented by military adventurists – the historical enemies of the
WHEREAS, these conspirators have repeatedly tried to bring down our
democratic Philippine State – who are now in a tactical alliance and
republican government;
engaged in a concerted and systematic conspiracy, over a broad front, to
bring down the duly constituted Government elected in May 2004;
WHEREAS, the claims of these elements have been recklessly magnified
by certain segments of the national media;
WHEREAS, these conspirators have repeatedly tried to bring down the
President;
WHEREAS, these series of actions is hurting the Philippine State by
obstructing governance, including hindering the growth of the economy
WHEREAS, the claims of these elements have been recklessly
and sabotaging the people’s confidence in the government and their faith
magnified by certain segments of the national media;
in the future of this country;
WHEREAS, this series of actions is hurting the Philippine State – by
WHEREAS, these actions are adversely affecting the economy;
obstructing governance including hindering the growth of the economy
WHEREAS, these activities give totalitarian forces; of both the extreme
Left and extreme Right the opening to intensify their avowed aims to
bring down the democratic Philippine State;
WHEREAS, Article 2, Section 4 of our Constitution makes the defense
and preservation of the democratic institutions and the State the primary
duty of Government;
WHEREAS, the activities above-described, their consequences,
ramifications and collateral effects constitute a clear and present danger
to the safety and the integrity of the Philippine State and of the Filipino
people;
WHEREAS, Proclamation 1017 date February 24, 2006 has been issued
declaring a State of National Emergency;
NOW, THEREFORE, I GLORIA MACAPAGAL-ARROYO, by virtue of
the powers vested in me under the Constitution as President of the
Republic of the Philippines, and Commander-in-Chief of the Republic of
the Philippines, and pursuant to Proclamation No. 1017 dated February
24, 2006, do hereby call upon the Armed Forces of the Philippines (AFP)
and the Philippine National Police (PNP), to prevent and suppress acts of
terrorism and lawless violence in the country;
I hereby direct the Chief of Staff of the AFP and the Chief of the PNP, as
well as the officers and men of the AFP and PNP, to immediately carry
out the necessary and appropriate actions and measures to
suppress and prevent acts of terrorism and lawless violence.
On March 3, 2006, exactly one week after the declaration of a state of
national emergency and after all these petitions had been filed, the
President lifted PP 1017. She issued Proclamation No. 1021 which
reads:
WHEREAS, pursuant to Section 18, Article VII and Section 17, Article XII
of the Constitution, Proclamation No. 1017 dated February 24, 2006, was
issued declaring a state of national emergency;
WHEREAS, by virtue of General Order No.5 and No.6 dated February
24, 2006, which were issued on the basis of Proclamation No. 1017, the
Armed Forces of the Philippines (AFP) and the Philippine National Police
(PNP), were directed to maintain law and order throughout the
Philippines, prevent and suppress all form of lawless violence as well as
any act of rebellion and to undertake such action as may be necessary;
WHEREAS, the AFP and PNP have effectively prevented, suppressed
and quelled the acts lawless violence and rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of
the Republic of the Philippines, by virtue of the powers vested in me by
law, hereby declare that the state of national emergency has ceased
to exist.
In their presentation of the factual bases of PP 1017 and G.O. No. 5,
respondents stated that the proximate cause behind the executive
issuances was the conspiracy among some military officers, leftist
insurgents of the New People’s Army (NPA), and some members of the
political opposition in a plot to unseat or assassinate President
Arroyo.4 They considered the aim to oust or assassinate the President
and take-over the reigns of government as a clear and present danger.
During the oral arguments held on March 7, 2006, the Solicitor General
specified the facts leading to the issuance of PP 1017 and G.O. No.
5. Significantly, there was no refutation from petitioners’ counsels.
The Solicitor General argued that the intent of the Constitution is to give
full discretionary powers to the President in determining the necessity
of calling out the armed forces. He emphasized that none of the
petitioners has shown that PP 1017 was without factual bases. While he
explained that it is not respondents’ task to state the facts behind the
questioned Proclamation, however, they are presenting the same,
narrated hereunder, for the elucidation of the issues.
On January 17, 2006, Captain Nathaniel Rabonza and First Lieutenants
Sonny Sarmiento, Lawrence San Juan and Patricio Bumidang, members
of the Magdalo Group indicted in the Oakwood mutiny, escaped their
detention cell in Fort Bonifacio, Taguig City. In a public statement, they
vowed to remain defiant and to elude arrest at all costs. They called upon
the people to "show and proclaim our displeasure at the sham regime.
Let us demonstrate our disgust, not only by going to the streets in
protest, but also by wearing red bands on our left arms." 5
On February 17, 2006, the authorities got hold of a document entitled
"Oplan Hackle I " which detailed plans for bombings and attacks during
the Philippine Military Academy Alumni Homecoming in Baguio City. The
plot was to assassinate selected targets including some cabinet
members and President Arroyo herself.6 Upon the advice of her security,
President Arroyo decided not to attend the Alumni Homecoming. The
next day, at the height of the celebration, a bomb was found and
detonated at the PMA parade ground.
On February 21, 2006, Lt. San Juan was recaptured in a communist
safehouse in Batangas province. Found in his possession were two (2)
flash disks containing minutes of the meetings between members of the
Magdalo Group and the National People’s Army (NPA), a tape recorder,
audio cassette cartridges, diskettes, and copies of subversive
documents.7 Prior to his arrest, Lt. San Juan announced through DZRH
that the "Magdalo’s D-Day would be on February 24, 2006, the 20th
Anniversary of Edsa I."
On February 23, 2006, PNP Chief Arturo Lomibao intercepted
information that members of the PNP- Special Action Force were
planning to defect. Thus, he immediately ordered SAF Commanding
General Marcelino Franco, Jr. to "disavow" any defection. The latter
promptly obeyed and issued a public statement: "All SAF units are under
the effective control of responsible and trustworthy officers with proven
integrity and unquestionable loyalty."
On the same day, at the house of former Congressman Peping
Cojuangco, President Cory Aquino’s brother, businessmen and mid-level
government officials plotted moves to bring down the Arroyo
administration. Nelly Sindayen of TIME Magazine reported that Pastor
Saycon, longtime Arroyo critic, called a U.S. government official about his
group’s plans if President Arroyo is ousted. Saycon also phoned a man
code-named Delta. Saycon identified him as B/Gen. Danilo Lim,
Commander of the Army’s elite Scout Ranger. Lim said "it was all
systems go for the planned movement against Arroyo."8
B/Gen. Danilo Lim and Brigade Commander Col. Ariel Querubin confided
to Gen. Generoso Senga, Chief of Staff of the Armed Forces of the
Philippines (AFP), that a huge number of soldiers would join the rallies to
provide a critical mass and armed component to the Anti-Arroyo protests
to be held on February 24, 2005. According to these two (2) officers,
there was no way they could possibly stop the soldiers because they too,
were breaking the chain of command to join the forces foist to unseat the
President. However, Gen. Senga has remained faithful to his
Commander-in-Chief and to the chain of command. He immediately took
custody of B/Gen. Lim and directed Col. Querubin to return to the
Philippine Marines Headquarters in Fort Bonifacio.
Earlier, the CPP-NPA called for intensification of political and
revolutionary work within the military and the police establishments in
order to forge alliances with its members and key officials. NPA
spokesman Gregorio "Ka Roger" Rosal declared: "The Communist Party
and revolutionary movement and the entire people look forward to the
possibility in the coming year of accomplishing its immediate task of
bringing down the Arroyo regime; of rendering it to weaken and unable to
rule that it will not take much longer to end it."9
On the other hand, Cesar Renerio, spokesman for the National
Democratic Front (NDF) at North Central Mindanao, publicly announced:
"Anti-Arroyo groups within the military and police are growing rapidly,
hastened by the economic difficulties suffered by the families of AFP
officers and enlisted personnel who undertake counter-insurgency
operations in the field." He claimed that with the forces of the national
democratic movement, the anti-Arroyo conservative political parties,
coalitions, plus the groups that have been reinforcing since June 2005, it
is probable that the President’s ouster is nearing its concluding stage in
the first half of 2006.
Respondents further claimed that the bombing of telecommunication
towers and cell sites in Bulacan and Bataan was also considered as
additional factual basis for the issuance of PP 1017 and G.O. No. 5. So is
the raid of an army outpost in Benguet resulting in the death of three (3)
soldiers. And also the directive of the Communist Party of the Philippines
ordering its front organizations to join 5,000 Metro Manila radicals and
25,000 more from the provinces in mass protests.10
By midnight of February 23, 2006, the President convened her security
advisers and several cabinet members to assess the gravity of the
fermenting peace and order situation. She directed both the AFP and the
PNP to account for all their men and ensure that the chain of command
remains solid and undivided. To protect the young students from any
possible trouble that might break loose on the streets, the President
suspended classes in all levels in the entire National Capital Region.
For their part, petitioners cited the events that followed after the
issuance of PP 1017 and G.O. No. 5.
Immediately, the Office of the President announced the cancellation of all
programs and activities related to the 20th anniversary celebration
of Edsa People Power I; and revoked the permits to hold rallies issued
earlier by the local governments. Justice Secretary Raul Gonzales stated
that political rallies, which to the President’s mind were organized for
purposes of destabilization, are cancelled.Presidential Chief of Staff
Michael Defensor announced that "warrantless arrests and take-over of
facilities, including media, can already be implemented."11
Undeterred by the announcements that rallies and public assemblies
would not be allowed, groups of protesters (members of Kilusang Mayo
Uno [KMU] and National Federation of Labor Unions-Kilusang Mayo
Uno [NAFLU-KMU]), marched from various parts of Metro Manila with the
intention of converging at the EDSA shrine. Those who were already
near the EDSA site were violently dispersed by huge clusters of anti-riot
police. The well-trained policemen used truncheons, big fiber glass
shields, water cannons, and tear gas to stop and break up the marching
groups, and scatter the massed participants. The same police action was
used against the protesters marching forward to Cubao, Quezon City and
to the corner of Santolan Street and EDSA. That same evening,
hundreds of riot policemen broke up an EDSA celebration rally held along
Ayala Avenue and Paseo de Roxas Street in Makati City. 12
According to petitioner Kilusang Mayo Uno, the police cited PP 1017 as
the ground for the dispersal of their assemblies.
During the dispersal of the rallyists along EDSA, police arrested (without
warrant) petitioner Randolf S. David, a professor at the University of the
Philippines and newspaper columnist. Also arrested was his companion,
Ronald Llamas, president of party-list Akbayan.
At around 12:20 in the early morning of February 25, 2006, operatives of
the Criminal Investigation and Detection Group (CIDG) of the PNP, on
the basis of PP 1017 and G.O. No. 5, raided the Daily Tribune offices in
Manila. The raiding team confiscated news stories by reporters,
documents, pictures, and mock-ups of the Saturday issue. Policemen
from Camp Crame in Quezon City were stationed inside the editorial and
business offices of the newspaper; while policemen from the Manila
Police District were stationed outside the building. 13
A few minutes after the search and seizure at the Daily Tribune offices,
the police surrounded the premises of another pro-opposition paper,
Malaya, and its sister publication, the tabloid Abante.
The raid, according to Presidential Chief of Staff Michael Defensor,
is "meant to show a ‘strong presence,’ to tell media outlets not to connive
or do anything that would help the rebels in bringing down this
government." The PNP warned that it would take over any media
organization that would not follow "standards set by the government
during the state of national emergency." Director General Lomibao stated
that "if they do not follow the standards – and the standards are - if they
would contribute to instability in the government, or if they do not
subscribe to what is in General Order No. 5 and Proc. No. 1017 – we will
recommend a ‘takeover.’" National Telecommunications’ Commissioner
Ronald Solis urged television and radio networks to "cooperate" with the
government for the duration of the state of national emergency. He asked
for "balanced reporting" from broadcasters when covering the events
surrounding the coup attempt foiled by the government. He warned that
his agency will not hesitate to recommend the closure of any broadcast
outfit that violates rules set out for media coverage when the national
security is threatened.14
Also, on February 25, 2006, the police arrested Congressman Crispin
Beltran, representing the Anakpawis Party and Chairman of Kilusang
Mayo Uno (KMU), while leaving his farmhouse in Bulacan. The police
showed a warrant for his arrest dated 1985. Beltran’s lawyer explained
that the warrant, which stemmed from a case of inciting to rebellion filed
during the Marcos regime, had long been quashed. Beltran, however, is
not a party in any of these petitions.
When members of petitioner KMU went to Camp Crame to visit Beltran,
they were told they could not be admitted because of PP 1017 and G.O.
No. 5. Two members were arrested and detained, while the rest were
dispersed by the police.
Bayan Muna Representative Satur Ocampo eluded arrest when the
police went after him during a public forum at the Sulo Hotel in Quezon
City. But his two drivers, identified as Roel and Art, were taken into
custody.
Retired Major General Ramon Montaño, former head of the Philippine
Constabulary, was arrested while with his wife and golfmates at the
Orchard Golf and Country Club in Dasmariñas, Cavite.
Attempts were made to arrest Anakpawis Representative Satur Ocampo,
Representative Rafael Mariano, Bayan Muna Representative Teodoro
Casiño and Gabriela Representative Liza Maza. Bayan
Muna Representative Josel Virador was arrested at the PAL Ticket Office
in Davao City. Later, he was turned over to the custody of the House of
Representatives where the "Batasan 5" decided to stay indefinitely.
Let it be stressed at this point that the alleged violations of the rights of
Representatives Beltran, Satur Ocampo, et al., are not being raised in
these petitions.
On March 3, 2006, President Arroyo issued PP 1021 declaring that the
state of national emergency has ceased to exist.
In the interim, these seven (7) petitions challenging the constitutionality of
PP 1017 and G.O. No. 5 were filed with this Court against the above-
named respondents. Three (3) of these petitions impleaded President
Arroyo as respondent.
In G.R. No. 171396, petitioners Randolf S. David, et al. assailed PP 1017
on the grounds that (1) it encroaches on the emergency powers of
Congress; (2) itis a subterfuge to avoid the constitutional requirements for
the imposition of martial law; and (3) it violates the constitutional
guarantees of freedom of the press, of speech and of assembly.
In G.R. No. 171409, petitioners Ninez Cacho-Olivares
and Tribune Publishing Co., Inc. challenged the CIDG’s act of raiding
the Daily Tribune offices as a clear case of "censorship" or "prior
restraint." They also claimed that the term "emergency" refers only to
tsunami, typhoon, hurricane and similar occurrences, hence, there is
"absolutely no emergency" that warrants the issuance of PP 1017.
In G.R. No. 171485, petitioners herein are Representative Francis
Joseph G. Escudero, and twenty one (21) other members of the House of
Representatives, including Representatives Satur Ocampo, Rafael
Mariano, Teodoro Casiño, Liza Maza, and Josel Virador. They asserted
that PP 1017 and G.O. No. 5 constitute "usurpation of legislative powers";
"violation of freedom of expression" and "a declaration of martial law."
They alleged that President Arroyo "gravely abused her discretion in
calling out the armed forces without clear and verifiable factual basis of
the possibility of lawless violence and a showing that there is necessity to
do so."
In G.R. No. 171483,petitioners KMU, NAFLU-KMU, and their members
averred that PP 1017 and G.O. No. 5 are unconstitutional
because (1) they arrogate unto President Arroyo the power to enact laws
and decrees; (2) their issuance was without factual basis; and (3) they
violate freedom of expression and the right of the people to peaceably
assemble to redress their grievances.
In G.R. No. 171400, petitioner Alternative Law Groups, Inc. (ALGI)
alleged that PP 1017 and G.O. No. 5 are unconstitutional because they
violate (a) Section 415 of Article II, (b) Sections 1,16 2,17 and 418 of Article
III, (c) Section 2319 of Article VI, and (d) Section 1720 of Article XII of the
Constitution.
In G.R. No. 171489, petitioners Jose Anselmo I. Cadiz et al., alleged that
PP 1017 is an "arbitrary and unlawful exercise by the President of her
Martial Law powers." And assuming that PP 1017 is not really a
declaration of Martial Law, petitioners argued that "it amounts to an
exercise by the President of emergency powers without congressional
approval." In addition, petitioners asserted that PP 1017 "goes beyond
the nature and function of a proclamation as defined under the Revised
Administrative Code."
And lastly, in G.R. No. 171424,petitionerLoren B. Legarda maintained
that PP 1017 and G.O. No. 5 are "unconstitutional for being violative of
the freedom of expression, including its cognate rights such as freedom
of the press and the right to access to information on matters of public
concern, all guaranteed under Article III, Section 4 of the 1987
Constitution." In this regard, she stated that these issuances prevented
her from fully prosecuting her election protest pending before the
Presidential Electoral Tribunal.
In respondents’ Consolidated Comment, the Solicitor General countered
that: first, the petitions should be dismissed for being
moot; second,petitioners in G.R. Nos. 171400 (ALGI), 171424 (Legarda),
171483 (KMU et al.), 171485 (Escudero et al.) and 171489 (Cadiz et al.)
have no legal standing; third, it is not necessary for petitioners to implead
President Arroyo as respondent; fourth, PP 1017 has constitutional and
legal basis; and fifth, PP 1017 does not violate the people’s right to free
expression and redress of grievances.
On March 7, 2006, the Court conducted oral arguments and heard the
parties on the above interlocking issues which may be summarized as
follows:
A. PROCEDURAL:
1) Whether the issuance of PP 1021 renders the petitions moot
and academic.
 2) Whether petitioners in 171485 (Escudero et al.), G.R. Nos.
171400 (ALGI), 171483 (KMU et al.), 171489 (Cadiz et al.),
and 171424 (Legarda) have legal standing.
B. SUBSTANTIVE:
1) Whetherthe Supreme Court can review the factual bases of PP
1017.
2) Whether PP 1017 and G.O. No. 5 are unconstitutional.
a. Facial Challenge
b. Constitutional Basis
c. As Applied Challenge
A. PROCEDURAL
First, we must resolve the procedural roadblocks.
I- Moot and Academic Principle
One of the greatest contributions of the American system to this country
is the concept of judicial review enunciated in Marbury v. Madison.21 This
concept rests on the extraordinary simple foundation --
The Constitution is the supreme law. It was ordained by the people, the
ultimate source of all political authority. It confers limited powers on the
national government. x x x If the government consciously or
unconsciously oversteps these limitations there must be some
authority competent to hold it in control, to thwart its
unconstitutional attempt, and thus to vindicate and preserve
inviolate the will of the people as expressed in the Constitution. This
power the courts exercise. This is the beginning and the end of the
theory of judicial review.22
But the power of judicial review does not repose upon the courts a "self-
starting capacity."23 Courts may exercise such power only when the
following requisites are present: first, there must be an actual case or
controversy; second, petitioners have to raise a question of
constitutionality; third, the constitutional question must be raised at the
earliest opportunity; and fourth, the decision of the constitutional question
must be necessary to the determination of the case itself. 24
Respondents maintain that the first and second requisites are absent,
hence, we shall limit our discussion thereon.
An actual case or controversy involves a conflict of legal right, an
opposite legal claims susceptible of judicial resolution. It is "definite and
concrete, touching the legal relations of parties having adverse legal
interest;" a real and substantial controversy admitting of specific
relief.25 The Solicitor General refutes the existence of such actual case or
controversy, contending that the present petitions were rendered "moot
and academic" by President Arroyo’s issuance of PP 1021.
Such contention lacks merit.
A moot and academic case is one that ceases to present a justiciable
controversy by virtue of supervening events, 26 so that a declaration
thereon would be of no practical use or value. 27 Generally, courts decline
jurisdiction over such case28 or dismiss it on ground of mootness.29
The Court holds that President Arroyo’s issuance of PP 1021 did not
render the present petitions moot and academic. During the eight (8)
days that PP 1017 was operative, the police officers, according to
petitioners, committed illegal acts in implementing it. Are PP 1017 and
G.O. No. 5 constitutional or valid? Do they justify these alleged
illegal acts? These are the vital issues that must be resolved in the
present petitions. It must be stressed that "an unconstitutional act is
not a law, it confers no rights, it imposes no duties, it affords no
protection; it is in legal contemplation, inoperative."30
The "moot and academic" principle is not a magical formula that can
automatically dissuade the courts in resolving a case. Courts will decide
cases, otherwise moot and academic, if: first, there is a grave violation of
the Constitution;31 second, the exceptional character of the situation and
the paramount public interest is involved; 32 third, when constitutional
issue raised requires formulation of controlling principles to guide the
bench, the bar, and the public;33 and fourth, the case is capable of
repetition yet evading review.34
All the foregoing exceptions are present here and justify this Court’s
assumption of jurisdiction over the instant petitions. Petitioners alleged
that the issuance of PP 1017 and G.O. No. 5 violates the Constitution.
There is no question that the issues being raised affect the public’s
interest, involving as they do the people’s basic rights to freedom of
expression, of assembly and of the press. Moreover, the Court has the
duty to formulate guiding and controlling constitutional precepts,
doctrines or rules. It has the symbolic function of educating the bench
and the bar, and in the present petitions, the military and the police, on
the extent of the protection given by constitutional guarantees.35 And
lastly, respondents’ contested actions are capable of repetition. Certainly,
the petitions are subject to judicial review.
In their attempt to prove the alleged mootness of this case, respondents
cited Chief Justice Artemio V. Panganiban’s Separate Opinion
in Sanlakas v. Executive Secretary.36 However, they failed to take into
account the Chief Justice’s very statement that an otherwise "moot" case
may still be decided "provided the party raising it in a proper case has
been and/or continues to be prejudiced or damaged as a direct result of
its issuance." The present case falls right within this exception to the
mootness rule pointed out by the Chief Justice.
II- Legal Standing
In view of the number of petitioners suing in various personalities, the
Court deems it imperative to have a more than passing discussion on
legal standing or locus standi.
Locus standi is defined as "a right of appearance in a court of justice on a
given question."37 In private suits, standing is governed by the "real-
parties-in interest" rule as contained in Section 2, Rule 3 of the 1997
Rules of Civil Procedure, as amended. It provides that "every action
must be prosecuted or defended in the name of the real party in
interest." Accordingly, the "real-party-in interest" is "the party who
stands to be benefited or injured by the judgment in the suit or the
party entitled to the avails of the suit."38 Succinctly put, the plaintiff’s
standing is based on his own right to the relief sought.
The difficulty of determining locus standi arises in public suits. Here, the
plaintiff who asserts a "public right" in assailing an allegedly illegal official
action, does so as a representative of the general public. He may be a
person who is affected no differently from any other person. He could be
suing as a "stranger," or in the category of a "citizen," or ‘taxpayer." In
either case, he has to adequately show that he is entitled to seek judicial
protection. In other words, he has to make out a sufficient interest in the
vindication of the public order and the securing of relief as a "citizen" or
"taxpayer.
Case law in most jurisdictions now allows both "citizen" and "taxpayer"
standing in public actions. The distinction was first laid down
in Beauchamp v. Silk,39 where it was held that the plaintiff in a taxpayer’s
suit is in a different category from the plaintiff in a citizen’s suit. In the
former, the plaintiff is affected by the expenditure of public funds,
while in the latter, he is but the mere instrument of the public
concern. As held by the New York Supreme Court in People ex rel Case
v. Collins:40 "In matter of mere public right, however…the people are
the real parties…It is at least the right, if not the duty, of every
citizen to interfere and see that a public offence be properly pursued
and punished, and that a public grievance be remedied." With
respect to taxpayer’s suits, Terr v. Jordan41 held that "the right of a
citizen and a taxpayer to maintain an action in courts to restrain the
unlawful use of public funds to his injury cannot be denied."
However, to prevent just about any person from seeking judicial
interference in any official policy or act with which he disagreed with, and
thus hinders the activities of governmental agencies engaged in public
service, the United State Supreme Court laid down the more stringent
"direct injury" test in Ex Parte Levitt,42 later reaffirmed in Tileston v.
Ullman.43 The same Court ruled that for a private individual to invoke the
judicial power to determine the validity of an executive or legislative
action, he must show that he has sustained a direct injury as a result
of that action, and it is not sufficient that he has a general interest
common to all members of the public.
This Court adopted the "direct injury" test in our jurisdiction. In People
v. Vera,44 it held that the person who impugns the validity of a statute
must have "a personal and substantial interest in the case such that
he has sustained, or will sustain direct injury as a result."
The Vera doctrine was upheld in a litany of cases, such as, Custodio v.
President of the Senate,45 Manila Race Horse Trainers’ Association v. De
la Fuente,46 Pascual v. Secretary of Public Works47 and Anti-Chinese
League of the Philippines v. Felix.48
However, being a mere procedural technicality, the requirement of locus
standi may be waived by the Court in the exercise of its discretion. This
was done in the 1949 Emergency Powers Cases, Araneta v.
Dinglasan,49 where the "transcendental importance" of the cases
prompted the Court to act liberally. Such liberality was neither a rarity nor
accidental. In Aquino v. Comelec,50 this Court resolved to pass upon the
issues raised due to the "far-reaching implications" of the petition
notwithstanding its categorical statement that petitioner therein had no
personality to file the suit. Indeed, there is a chain of cases where this
liberal policy has been observed, allowing ordinary citizens, members of
Congress, and civic organizations to prosecute actions involving the
constitutionality or validity of laws, regulations and rulings. 51
Thus, the Court has adopted a rule that even where the petitioners have
failed to show direct injury, they have been allowed to sue under the
principle of "transcendental importance." Pertinent are the following
cases:
(1) Chavez v. Public Estates Authority,52 where the Court ruled
that the enforcement of the constitutional right to information
and the equitable diffusion of natural resources are matters
of transcendental importance which clothe the petitioner
with locus standi;
(2) Bagong Alyansang Makabayan v. Zamora,53 wherein the
Court held that "given the transcendental importance of the
issues involved, the Court may relax the standing
requirements and allow the suit to prosper despite the lack
of direct injury to the parties seeking judicial review" of the
Visiting Forces Agreement;
(3) Lim v. Executive Secretary,54 while the Court noted that the
petitioners may not file suit in their capacity as taxpayers absent a
showing that "Balikatan 02-01" involves the exercise of Congress’
taxing or spending powers, it reiterated its ruling in Bagong
Alyansang Makabayan v. Zamora,55that in cases of
transcendental importance, the cases must be settled
promptly and definitely and standing requirements may be
relaxed.
By way of summary, the following rules may be culled from the cases
decided by this Court. Taxpayers, voters, concerned citizens, and
legislators may be accorded standing to sue, provided that the following
requirements are met:
(1) the cases involve constitutional issues;
(2) for taxpayers, there must be a claim of illegal disbursement of
public funds or that the tax measure is unconstitutional;
(3) for voters, there must be a showing of obvious interest in the
validity of the election law in question;
(4) for concerned citizens, there must be a showing that the
issues raised are of transcendental importance which must be
settled early; and
(5) for legislators, there must be a claim that the official action
complained of infringes upon their prerogatives as legislators.
Significantly, recent decisions show a certain toughening in the Court’s
attitude toward legal standing.
In Kilosbayan, Inc. v. Morato,56 the Court ruled that the status
of Kilosbayan as a people’s organization does not give it the requisite
personality to question the validity of the on-line lottery contract, more so
where it does not raise any issue of constitutionality. Moreover, it cannot
sue as a taxpayer absent any allegation that public funds are being
misused. Nor can it sue as a concerned citizen as it does not allege any
specific injury it has suffered.
In Telecommunications and Broadcast Attorneys of the Philippines, Inc.
v. Comelec,57 the Court reiterated the "direct injury" test with respect to
concerned citizens’ cases involving constitutional issues. It held that
"there must be a showing that the citizen personally suffered some actual
or threatened injury arising from the alleged illegal official act."
In Lacson v. Perez,58 the Court ruled that one of the petitioners, Laban ng
Demokratikong Pilipino (LDP), is not a real party-in-interest as it had not
demonstrated any injury to itself or to its leaders, members or supporters.
In Sanlakas v. Executive Secretary,59 the Court ruled that only the
petitioners who are members of Congress have standing to sue, as they
claim that the President’s declaration of a state of rebellion is a
usurpation of the emergency powers of Congress, thus impairing
their legislative powers. As to petitioners Sanlakas, Partido
Manggagawa, and Social Justice Society, the Court declared them to be
devoid of standing, equating them with the LDP in Lacson.
Now, the application of the above principles to the present petitions.
The locus standi of petitioners in G.R. No. 171396, particularly David and
Llamas, is beyond doubt. The same holds true with petitioners in G.R.
No. 171409, Cacho-Olivares and Tribune Publishing Co. Inc. They
alleged "direct injury" resulting from "illegal arrest" and "unlawful search"
committed by police operatives pursuant to PP 1017. Rightly so, the
Solicitor General does not question their legal standing.
In G.R. No. 171485, the opposition Congressmen alleged there was
usurpation of legislative powers. They also raised the issue of whether or
not the concurrence of Congress is necessary whenever the alarming
powers incident to Martial Law are used. Moreover, it is in the interest of
justice that those affected by PP 1017 can be represented by their
Congressmen in bringing to the attention of the Court the alleged
violations of their basic rights.
In G.R. No. 171400, (ALGI), this Court applied the liberality rule
in Philconsa v. Enriquez,60 Kapatiran Ng Mga Naglilingkod sa
Pamahalaan ng Pilipinas, Inc. v. Tan,61 Association of Small Landowners
in the Philippines, Inc. v. Secretary of Agrarian Reform,62 Basco v.
Philippine Amusement and Gaming Corporation,63 and Tañada v.
Tuvera,64 that when the issue concerns a public right, it is sufficient that
the petitioner is a citizen and has an interest in the execution of the laws.
In G.R. No. 171483, KMU’s assertion that PP 1017 and G.O. No. 5
violated its right to peaceful assembly may be deemed sufficient to give it
legal standing. Organizations may be granted standing to assert the
rights of their members.65 We take judicial notice of the announcement
by the Office of the President banning all rallies and canceling all permits
for public assemblies following the issuance of PP 1017 and G.O. No. 5.
In G.R. No. 171489, petitioners, Cadiz et al., who are national officers of
the Integrated Bar of the Philippines (IBP) have no legal standing, having
failed to allege any direct or potential injury which the IBP as an
institution or its members may suffer as a consequence of the issuance
of PP No. 1017 and G.O. No. 5. In Integrated Bar of the Philippines v.
Zamora,66 the Court held that the mere invocation by the IBP of its duty to
preserve the rule of law and nothing more, while undoubtedly true, is not
sufficient to clothe it with standing in this case. This is too general an
interest which is shared by other groups and the whole citizenry.
However, in view of the transcendental importance of the issue, this
Court declares that petitioner have locus standi.
In G.R. No. 171424, Loren Legarda has no personality as a taxpayer to
file the instant petition as there are no allegations of illegal disbursement
of public funds. The fact that she is a former Senator is of no
consequence. She can no longer sue as a legislator on the allegation that
her prerogatives as a lawmaker have been impaired by PP 1017 and
G.O. No. 5. Her claim that she is a media personality will not likewise aid
her because there was no showing that the enforcement of these
issuances prevented her from pursuing her occupation. Her submission
that she has pending electoral protest before the Presidential Electoral
Tribunal is likewise of no relevance. She has not sufficiently shown that
PP 1017 will affect the proceedings or result of her case. But considering
once more the transcendental importance of the issue involved, this
Court may relax the standing rules.
It must always be borne in mind that the question of locus standi is but
corollary to the bigger question of proper exercise of judicial power. This
is the underlying legal tenet of the "liberality doctrine" on legal standing. It
cannot be doubted that the validity of PP No. 1017 and G.O. No. 5 is a
judicial question which is of paramount importance to the Filipino people.
To paraphrase Justice Laurel, the whole of Philippine society now waits
with bated breath the ruling of this Court on this very critical matter. The
petitions thus call for the application of the "transcendental importance"
doctrine, a relaxation of the standing requirements for the petitioners in
the "PP 1017 cases." 1avvphil.net
This Court holds that all the petitioners herein have locus standi.
Incidentally, it is not proper to implead President Arroyo as respondent.
Settled is the doctrine that the President, during his tenure of office or
actual incumbency,67 may not be sued in any civil or criminal case, and
there is no need to provide for it in the Constitution or law. It will degrade
the dignity of the high office of the President, the Head of State, if he can
be dragged into court litigations while serving as such. Furthermore, it is
important that he be freed from any form of harassment, hindrance or
distraction to enable him to fully attend to the performance of his official
duties and functions. Unlike the legislative and judicial branch, only one
constitutes the executive branch and anything which impairs his
usefulness in the discharge of the many great and important duties
imposed upon him by the Constitution necessarily impairs the operation
of the Government. However, this does not mean that the President is
not accountable to anyone. Like any other official, he remains
accountable to the people68 but he may be removed from office only in
the mode provided by law and that is by impeachment. 69
B. SUBSTANTIVE
 I. Review of Factual Bases
Petitioners maintain that PP 1017 has no factual basis. Hence, it was not
"necessary" for President Arroyo to issue such Proclamation.
The issue of whether the Court may review the factual bases of the
President’s exercise of his Commander-in-Chief power has reached its
distilled point - from the indulgent days of Barcelon v.
Baker70 and Montenegro v. Castaneda71 to the volatile era of Lansang v.
Garcia,72 Aquino, Jr. v. Enrile,73 and Garcia-Padilla v. Enrile.74 The tug-of-
war always cuts across the line defining "political questions," particularly
those questions "in regard to which full discretionary authority has been
delegated to the legislative or executive branch of the
government."75 Barcelon and Montenegro were in unison in declaring that
the authority to decide whether an exigency has arisen belongs to
the President and his decision is final and conclusive on the
courts. Lansang took the opposite view. There, the members of the
Court were unanimous in the conviction that the Court has the authority
to inquire into the existence of factual bases in order to determine their
constitutional sufficiency. From the principle of separation of powers,
it shifted the focus to the system of checks and balances, "under
which the President is supreme, x x x only if and when he acts
within the sphere allotted to him by the Basic Law, and the authority
to determine whether or not he has so acted is vested in the Judicial
Department, which in this respect, is, in turn,
constitutionally supreme."76 In 1973, the unanimous Court
of Lansang was divided in Aquino v. Enrile.77 There, the Court was almost
evenly divided on the issue of whether the validity of the imposition of
Martial Law is a political or justiciable question.78 Then came Garcia-
Padilla v. Enrile which greatly diluted Lansang. It declared that there is a
need to re-examine the latter case, ratiocinating that "in times of war or
national emergency, the President must be given absolute control
for the very life of the nation and the government is in great peril.
The President, it intoned, is answerable only to his conscience, the
People, and God."79
The Integrated Bar of the Philippines v. Zamora80 -- a recent case most
pertinent to these cases at bar -- echoed a principle similar
to Lansang. While the Court considered the President’s "calling-out"
power as a discretionary power solely vested in his wisdom, it stressed
that "this does not prevent an examination of whether such power
was exercised within permissible constitutional limits or whether it
was exercised in a manner constituting grave abuse of
discretion."This ruling is mainly a result of the Court’s reliance on
Section 1, Article VIII of 1987 Constitution which fortifies the authority of
the courts to determine in an appropriate action the validity of the acts of
the political departments. Under the new definition of judicial power, the
courts are authorized not only "to settle actual controversies involving
rights which are legally demandable and enforceable," but also "to
determine whether or not there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the government." The latter part of the
authority represents a broadening of judicial power to enable the courts
of justice to review what was before a forbidden territory, to wit, the
discretion of the political departments of the government. 81 It speaks of
judicial prerogative not only in terms of power but also of duty.82
As to how the Court may inquire into the President’s exercise of
power, Lansang adopted the test that "judicial inquiry can go no
further than to satisfy the Court not that the President’s decision
is correct," but that "the President did not act arbitrarily." Thus, the
standard laid down is not correctness, but arbitrariness. 83 In Integrated
Bar of the Philippines, this Court further ruled that "it is incumbent upon
the petitioner to show that the President’s decision is totally bereft
of factual basis" and that if he fails, by way of proof, to support his
assertion, then "this Court cannot undertake an independent
investigation beyond the pleadings."
Petitioners failed to show that President Arroyo’s exercise of the calling-
out power, by issuing PP 1017, is totally bereft of factual basis. A reading
of the Solicitor General’s Consolidated Comment and Memorandum
shows a detailed narration of the events leading to the issuance of PP
1017, with supporting reports forming part of the records. Mentioned are
the escape of the Magdalo Group, their audacious threat of the Magdalo
D-Day, the defections in the military, particularly in the Philippine
Marines, and the reproving statements from the communist leaders.
There was also the Minutes of the Intelligence Report and Security Group
of the Philippine Army showing the growing alliance between the NPA
and the military. Petitioners presented nothing to refute such events.
Thus, absent any contrary allegations, the Court is convinced that the
President was justified in issuing PP 1017 calling for military aid.
Indeed, judging the seriousness of the incidents, President Arroyo was
not expected to simply fold her arms and do nothing to prevent or
suppress what she believed was lawless violence, invasion or rebellion.
However, the exercise of such power or duty must not stifle liberty.
 II. Constitutionality of PP 1017 and G.O. No. 5
Doctrines of Several Political Theorists
on the Power of the President in Times of Emergency
This case brings to fore a contentious subject -- the power of the
President in times of emergency. A glimpse at the various political
theories relating to this subject provides an adequate backdrop for our
ensuing discussion.
John Locke, describing the architecture of civil government, called upon
the English doctrine of prerogative to cope with the problem of
emergency. In times of danger to the nation, positive law enacted by the
legislature might be inadequate or even a fatal obstacle to the
promptness of action necessary to avert catastrophe. In these situations,
the Crown retained a prerogative "power to act according to discretion
for the public good, without the proscription of the law and
sometimes even against it."84 But Locke recognized that this moral
restraint might not suffice to avoid abuse of prerogative powers. Who
shall judge the need for resorting to the prerogative and how may
its abuse be avoided? Here, Locke readily admitted defeat, suggesting
that "the people have no other remedy in this, as in all other cases
where they have no judge on earth, but to appeal to Heaven."85
Jean-Jacques Rousseau also assumed the need for temporary
suspension of democratic processes of government in time of
emergency. According to him:
The inflexibility of the laws, which prevents them from adopting
themselves to circumstances, may, in certain cases, render them
disastrous and make them bring about, at a time of crisis, the ruin of the
State…
It is wrong therefore to wish to make political institutions as strong as to
render it impossible to suspend their operation. Even Sparta allowed its
law to lapse...
If the peril is of such a kind that the paraphernalia of the laws are an
obstacle to their preservation, the method is to nominate a supreme
lawyer, who shall silence all the laws and suspend for a moment the
sovereign authority. In such a case, there is no doubt about the general
will, and it clear that the people’s first intention is that the State shall not
perish.86
Rosseau did not fear the abuse of the emergency dictatorship or
"supreme magistracy" as he termed it. For him, it would more likely be
cheapened by "indiscreet use." He was unwilling to rely upon an "appeal
to heaven." Instead, he relied upon a tenure of office of prescribed
duration to avoid perpetuation of the dictatorship. 87
John Stuart Mill concluded his ardent defense of representative
government: "I am far from condemning, in cases of extreme
necessity, the assumption of absolute power in the form of a
temporary dictatorship."88
Nicollo Machiavelli’s view of emergency powers, as one element in the
whole scheme of limited government, furnished an ironic contrast to the
Lockean theory of prerogative. He recognized and attempted to bridge
this chasm in democratic political theory, thus:
Now, in a well-ordered society, it should never be necessary to resort to
extra –constitutional measures; for although they may for a time be
beneficial, yet the precedent is pernicious, for if the practice is once
established for good objects, they will in a little while be disregarded
under that pretext but for evil purposes. Thus, no republic will ever be
perfect if she has not by law provided for everything, having a remedy for
every emergency and fixed rules for applying it.89
Machiavelli – in contrast to Locke, Rosseau and Mill – sought to
incorporate into the constitution a regularized system of standby
emergency powers to be invoked with suitable checks and controls in
time of national danger. He attempted forthrightly to meet the problem of
combining a capacious reserve of power and speed and vigor in its
application in time of emergency, with effective constitutional restraints. 90
Contemporary political theorists, addressing themselves to the problem of
response to emergency by constitutional democracies, have employed
the doctrine of constitutional dictatorship. 91 Frederick M. Watkins saw "no
reason why absolutism should not be used as a means for the
defense of liberal institutions," provided it "serves to protect
established institutions from the danger of permanent injury in a
period of temporary emergency and is followed by a prompt return
to the previous forms of political life."92 He recognized the two (2) key
elements of the problem of emergency governance, as well as all
constitutional governance: increasing administrative powers of the
executive, while at the same time "imposing limitation upon that
power."93 Watkins placed his real faith in a scheme of constitutional
dictatorship. These are the conditions of success of such a
dictatorship: "The period of dictatorship must be relatively
short…Dictatorship should always be strictly legitimate in
character…Final authority to determine the need for dictatorship in
any given case must never rest with the dictator himself…"94 and the
objective of such an emergency dictatorship should be "strict political
conservatism."
Carl J. Friedrich cast his analysis in terms similar to those of Watkins. 95 "It
is a problem of concentrating power – in a government where power has
consciously been divided – to cope with… situations of unprecedented
magnitude and gravity. There must be a broad grant of powers, subject to
equally strong limitations as to who shall exercise such powers, when, for
how long, and to what end."96 Friedrich, too, offered criteria for judging
the adequacy of any of scheme of emergency powers, to wit: "The
emergency executive must be appointed by constitutional means –
i.e., he must be legitimate; he should not enjoy power to determine
the existence of an emergency; emergency powers should be
exercised under a strict time limitation; and last, the objective of
emergency action must be the defense of the constitutional order."97
Clinton L. Rossiter, after surveying the history of the employment of
emergency powers in Great Britain, France, Weimar, Germany and the
United States, reverted to a description of a scheme of "constitutional
dictatorship" as solution to the vexing problems presented by
emergency.98 Like Watkins and Friedrich, he stated a priori the conditions
of success of the "constitutional dictatorship," thus:
1) No general regime or particular institution of constitutional
dictatorship should be initiated unless it is necessary or even
indispensable to the preservation of the State and its
constitutional order…
2) …the decision to institute a constitutional dictatorship should
never be in the hands of the man or men who will constitute the
dictator…
3) No government should initiate a constitutional dictatorship
without making specific provisions for its termination…
4) …all uses of emergency powers and all readjustments in the
organization of the government should be effected in pursuit of
constitutional or legal requirements…
5) … no dictatorial institution should be adopted, no right invaded,
no regular procedure altered any more than is absolutely
necessary for the conquest of the particular crisis . . .
6) The measures adopted in the prosecution of the a
constitutional dictatorship should never be permanent in
character or effect…
7) The dictatorship should be carried on by persons
representative of every part of the citizenry interested in the
defense of the existing constitutional order. . .
8) Ultimate responsibility should be maintained for every action
taken under a constitutional dictatorship. . .
9) The decision to terminate a constitutional dictatorship, like the
decision to institute one should never be in the hands of the man
or men who constitute the dictator. . .
10) No constitutional dictatorship should extend beyond the
termination of the crisis for which it was instituted…
11) …the termination of the crisis must be followed by a complete
return as possible to the political and governmental conditions
existing prior to the initiation of the constitutional dictatorship… 99
Rossiter accorded to legislature a far greater role in the oversight
exercise of emergency powers than did Watkins. He would secure to
Congress final responsibility for declaring the existence or termination of
an emergency, and he places great faith in the effectiveness of
congressional investigating committees. 100
Scott and Cotter, in analyzing the above contemporary theories in light of
recent experience, were one in saying that, "the suggestion that
democracies surrender the control of government to an
authoritarian ruler in time of grave danger to the nation is not based
upon sound constitutional theory." To appraise emergency power in
terms of constitutional dictatorship serves merely to distort the problem
and hinder realistic analysis. It matters not whether the term "dictator" is
used in its normal sense (as applied to authoritarian rulers) or is
employed to embrace all chief executives administering emergency
powers. However used, "constitutional dictatorship" cannot be divorced
from the implication of suspension of the processes of constitutionalism.
Thus, they favored instead the "concept of constitutionalism" articulated
by Charles H. McIlwain:
A concept of constitutionalism which is less misleading in the analysis of
problems of emergency powers, and which is consistent with the findings
of this study, is that formulated by Charles H. McIlwain. While it does not
by any means necessarily exclude some indeterminate limitations upon
the substantive powers of government, full emphasis is placed
upon procedural limitations, and political responsibility. McIlwain
clearly recognized the need to repose adequate power in government.
And in discussing the meaning of constitutionalism, he insisted that
the historical and proper test of constitutionalism was the existence
of adequate processes for keeping government responsible. He
refused to equate constitutionalism with the enfeebling of government by
an exaggerated emphasis upon separation of powers and substantive
limitations on governmental power. He found that the really effective
checks on despotism have consisted not in the weakening of government
but, but rather in the limiting of it; between which there is a great and
very significant difference. In associating constitutionalism with
"limited" as distinguished from "weak" government, McIlwain meant
government limited to the orderly procedure of law as opposed to
the processes of force. The two fundamental correlative elements of
constitutionalism for which all lovers of liberty must yet fight are the
legal limits to arbitrary power and a complete political responsibility
of government to the governed.101
In the final analysis, the various approaches to emergency of the above
political theorists –- from Lock’s "theory of prerogative," to Watkins’
doctrine of "constitutional dictatorship" and, eventually, to McIlwain’s
"principle of constitutionalism" --- ultimately aim to solve one real problem
in emergency governance, i.e., that of allotting increasing areas of
discretionary power to the Chief Executive, while insuring that such
powers will be exercised with a sense of political responsibility and
under effective limitations and checks.
Our Constitution has fairly coped with this problem. Fresh from the fetters
of a repressive regime, the 1986 Constitutional Commission, in drafting
the 1987 Constitution, endeavored to create a government in the concept
of Justice Jackson’s "balanced power structure." 102 Executive, legislative,
and judicial powers are dispersed to the President, the Congress, and the
Supreme Court, respectively. Each is supreme within its own sphere. But
none has the monopoly of power in times of emergency. Each
branch is given a role to serve as limitation or check upon the
other. This system does not weaken the President, it just limits his
power, using the language of McIlwain. In other words, in times of
emergency, our Constitution reasonably demands that we repose a
certain amount of faith in the basic integrity and wisdom of the Chief
Executive but, at the same time, it obliges him to operate within
carefully prescribed procedural limitations.
a. "Facial Challenge"
Petitioners contend that PP 1017 is void on its face because of its
"overbreadth." They claim that its enforcement encroached on both
unprotected and protected rights under Section 4, Article III of the
Constitution and sent a "chilling effect" to the citizens.
A facial review of PP 1017, using the overbreadth doctrine, is uncalled
for.
First and foremost, the overbreadth doctrine is an analytical tool
developed for testing "on their faces" statutes in free speech cases, also
known under the American Law as First Amendment cases.103
A plain reading of PP 1017 shows that it is not primarily directed to
speech or even speech-related conduct. It is actually a call upon the AFP
to prevent or suppress all forms of lawless violence. In United States v.
Salerno,104 the US Supreme Court held that "we have not recognized an
‘overbreadth’ doctrine outside the limited context of the First
Amendment" (freedom of speech).
Moreover, the overbreadth doctrine is not intended for testing the validity
of a law that "reflects legitimate state interest in maintaining
comprehensive control over harmful, constitutionally unprotected
conduct." Undoubtedly, lawless violence, insurrection and rebellion are
considered "harmful" and "constitutionally unprotected conduct."
In Broadrick v. Oklahoma,105 it was held:
It remains a ‘matter of no little difficulty’ to determine when a law may
properly be held void on its face and when ‘such summary action’ is
inappropriate. But the plain import of our cases is, at the very least,
that facial overbreadth adjudication is an exception to our
traditional rules of practice and that its function, a limited one at the
outset, attenuates as the otherwise unprotected behavior that it
forbids the State to sanction moves from ‘pure speech’ toward
conduct and that conduct –even if expressive – falls within the
scope of otherwise valid criminal laws that reflect legitimate state
interests in maintaining comprehensive controls over harmful,
constitutionally unprotected conduct.
Thus, claims of facial overbreadth are entertained in cases involving
statutes which, by their terms, seek to regulate only "spoken words"
and again, that "overbreadth claims, if entertained at all, have been
curtailed when invoked against ordinary criminal laws that are
sought to be applied to protected conduct."106 Here, the
incontrovertible fact remains that PP 1017 pertains to a spectrum
of conduct, not free speech, which is manifestly subject to state
regulation.
Second, facial invalidation of laws is considered as "manifestly strong
medicine," to be used "sparingly and only as a last resort," and is
"generally disfavored;"107 The reason for this is obvious. Embedded in
the traditional rules governing constitutional adjudication is the principle
that a person to whom a law may be applied will not be heard to
challenge a law on the ground that it may conceivably be applied
unconstitutionally to others, i.e., in other situations not before the
Court.108 A writer and scholar in Constitutional Law explains further:
The most distinctive feature of the overbreadth technique is that it
marks an exception to some of the usual rules of constitutional
litigation. Ordinarily, a particular litigant claims that a statute is
unconstitutional as applied to him or her; if the litigant prevails, the
courts carve away the unconstitutional aspects of the law by
invalidating its improper applications on a case to case basis.
Moreover, challengers to a law are not permitted to raise the rights
of third parties and can only assert their own interests. In
overbreadth analysis, those rules give way; challenges are
permitted to raise the rights of third parties; and the court invalidates
the entire statute "on its face," not merely "as applied for" so that the
overbroad law becomes unenforceable until a properly authorized court
construes it more narrowly. The factor that motivates courts to depart
from the normal adjudicatory rules is the concern with the "chilling;"
deterrent effect of the overbroad statute on third parties not courageous
enough to bring suit. The Court assumes that an overbroad law’s "very
existence may cause others not before the court to refrain from
constitutionally protected speech or expression." An overbreadth ruling is
designed to remove that deterrent effect on the speech of those third
parties.
In other words, a facial challenge using the overbreadth doctrine will
require the Court to examine PP 1017 and pinpoint its flaws and defects,
not on the basis of its actual operation to petitioners, but on the
assumption or prediction that its very existence may cause others not
before the Court to refrain from constitutionally protected speech or
expression. In Younger v. Harris,109 it was held that:
[T]he task of analyzing a proposed statute, pinpointing its deficiencies,
and requiring correction of these deficiencies before the statute is put into
effect, is rarely if ever an appropriate task for the judiciary. The
combination of the relative remoteness of the controversy, the impact
on the legislative process of the relief sought, and above all the
speculative and amorphous nature of the required line-by-line
analysis of detailed statutes,...ordinarily results in a kind of case that
is wholly unsatisfactory for deciding constitutional questions, whichever
way they might be decided.
And third, a facial challenge on the ground of overbreadth is the most
difficult challenge to mount successfully, since the challenger must
establish that there can be no instance when the assailed law may be
valid. Here, petitioners did not even attempt to show whether this
situation exists.
Petitioners likewise seek a facial review of PP 1017 on the ground of
vagueness. This, too, is unwarranted.
Related to the "overbreadth" doctrine is the "void for vagueness doctrine"
which holds that "a law is facially invalid if men of common
intelligence must necessarily guess at its meaning and differ as to
its application."110 It is subject to the same principles governing
overbreadth doctrine. For one, it is also an analytical tool for testing "on
their faces" statutes in free speech cases. And like overbreadth, it is
said that a litigant may challenge a statute on its face only if it is vague in
all its possible applications. Again, petitioners did not even attempt
to show that PP 1017 is vague in all its application. They also failed to
establish that men of common intelligence cannot understand the
meaning and application of PP 1017.
b. Constitutional Basis of PP 1017
Now on the constitutional foundation of PP 1017.
The operative portion of PP 1017 may be divided into three important
provisions, thus:
First provision:
"by virtue of the power vested upon me by Section 18, Artilce VII … do
hereby command the Armed Forces of the Philippines, to maintain law
and order throughout the Philippines, prevent or suppress all forms of
lawless violence as well any act of insurrection or rebellion"
Second provision:
"and to enforce obedience to all the laws and to all decrees, orders and
regulations promulgated by me personally or upon my direction;"
Third provision:
"as provided in Section 17, Article XII of the Constitution do hereby
declare a State of National Emergency."
First Provision: Calling-out Power
The first provision pertains to the President’s calling-out power.
In Sanlakas v. Executive Secretary,111 this Court, through Mr. Justice
Dante O. Tinga, held that Section 18, Article VII of the Constitution
reproduced as follows:
Sec. 18. The President shall be the Commander-in-Chief of all armed
forces of the Philippines and whenever it becomes necessary, he may
call out such armed forces to prevent or suppress lawless violence,
invasion or rebellion. In case of invasion or rebellion, when the public
safety requires it, he may, for a period not exceeding sixty days, suspend
the privilege of the writ of habeas corpus or place the Philippines or any
part thereof under martial law. Within forty-eight hours from the
proclamation of martial law or the suspension of the privilege of the writ
of habeas corpus, the President shall submit a report in person or in
writing to the Congress. The Congress, voting jointly, by a vote of at least
a majority of all its Members in regular or special session, may revoke
such proclamation or suspension, which revocation shall not be set aside
by the President. Upon the initiative of the President, the Congress may,
in the same manner, extend such proclamation or suspension for a
period to be determined by the Congress, if the invasion or rebellion shall
persist and public safety requires it.
The Congress, if not in session, shall within twenty-four hours following
such proclamation or suspension, convene in accordance with its rules
without need of a call.
The Supreme Court may review, in an appropriate proceeding filed by
any citizen, the sufficiency of the factual bases of the proclamation of
martial law or the suspension of the privilege of the writ or the extension
thereof, and must promulgate its decision thereon within thirty days from
its filing.
A state of martial law does not suspend the operation of the Constitution,
nor supplant the functioning of the civil courts or legislative assemblies,
nor authorize the conferment of jurisdiction on military courts and
agencies over civilians where civil courts are able to function, nor
automatically suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to persons
judicially charged for rebellion or offenses inherent in or directly
connected with invasion.
During the suspension of the privilege of the writ, any person thus
arrested or detained shall be judicially charged within three days,
otherwise he shall be released.
grants the President, as Commander-in-Chief, a "sequence" of graduated
powers. From the most to the least benign, these are: the calling-out
power, the power to suspend the privilege of the writ of habeas corpus,
and the power to declare Martial Law. Citing Integrated Bar of the
Philippines v. Zamora,112 the Court ruled that the only criterion for the
exercise of the calling-out power is that "whenever it becomes
necessary," the President may call the armed forces "to prevent or
suppress lawless violence, invasion or rebellion." Are these
conditions present in the instant cases? As stated earlier, considering the
circumstances then prevailing, President Arroyo found it necessary to
issue PP 1017. Owing to her Office’s vast intelligence network, she is in
the best position to determine the actual condition of the country.
Under the calling-out power, the President may summon the armed
forces to aid him in suppressing lawless violence, invasion and
rebellion. This involves ordinary police action. But every act that goes
beyond the President’s calling-out power is considered illegal or ultra
vires. For this reason, a President must be careful in the exercise of his
powers. He cannot invoke a greater power when he wishes to act under
a lesser power. There lies the wisdom of our Constitution, the greater the
power, the greater are the limitations.
It is pertinent to state, however, that there is a distinction between the
President’s authority to declare a "state of rebellion" (in Sanlakas) and
the authority to proclaim a state of national emergency. While President
Arroyo’s authority to declare a "state of rebellion" emanates from her
powers as Chief Executive, the statutory authority cited in Sanlakas was
Section 4, Chapter 2, Book II of the Revised Administrative Code of
1987, which provides:
SEC. 4. – Proclamations. – Acts of the President fixing a date or
declaring a status or condition of public moment or interest, upon the
existence of which the operation of a specific law or regulation is made to
depend, shall be promulgated in proclamations which shall have the force
of an executive order.
President Arroyo’s declaration of a "state of rebellion" was merely an act
declaring a status or condition of public moment or interest, a declaration
allowed under Section 4 cited above. Such declaration, in the words
of Sanlakas, is harmless, without legal significance, and deemed not
written. In these cases, PP 1017 is more than that. In declaring a state of
national emergency, President Arroyo did not only rely on Section 18,
Article VII of the Constitution, a provision calling on the AFP to prevent or
suppress lawless violence, invasion or rebellion. She also relied on
Section 17, Article XII, a provision on the State’s extraordinary power to
take over privately-owned public utility and business affected with public
interest. Indeed, PP 1017 calls for the exercise of an awesome power.
Obviously, such Proclamation cannot be deemed harmless, without legal
significance, or not written, as in the case of Sanlakas.
Some of the petitioners vehemently maintain that PP 1017 is actually a
declaration of Martial Law. It is no so. What defines the character of PP
1017 are its wordings. It is plain therein that what the President invoked
was her calling-out power.
The declaration of Martial Law is a "warn[ing] to citizens that the military
power has been called upon by the executive to assist in the
maintenance of law and order, and that, while the emergency lasts, they
must, upon pain of arrest and punishment, not commit any acts which will
in any way render more difficult the restoration of order and the
enforcement of law."113
In his "Statement before the Senate Committee on Justice" on March 13,
2006, Mr. Justice Vicente V. Mendoza,114 an authority in constitutional
law, said that of the three powers of the President as Commander-in-
Chief, the power to declare Martial Law poses the most severe threat to
civil liberties. It is a strong medicine which should not be resorted to
lightly. It cannot be used to stifle or persecute critics of the government. It
is placed in the keeping of the President for the purpose of enabling him
to secure the people from harm and to restore order so that they can
enjoy their individual freedoms. In fact, Section 18, Art. VII, provides:
A state of martial law does not suspend the operation of the Constitution,
nor supplant the functioning of the civil courts or legislative assemblies,
nor authorize the conferment of jurisdiction on military courts and
agencies over civilians where civil courts are able to function, nor
automatically suspend the privilege of the writ.
Justice Mendoza also stated that PP 1017 is not a declaration of Martial
Law. It is no more than a call by the President to the armed forces to
prevent or suppress lawless violence. As such, it cannot be used to
justify acts that only under a valid declaration of Martial Law can be done.
Its use for any other purpose is a perversion of its nature and scope, and
any act done contrary to its command is ultra vires.
Justice Mendoza further stated that specifically, (a) arrests and seizures
without judicial warrants; (b) ban on public assemblies; (c) take-over of
news media and agencies and press censorship; and (d) issuance of
Presidential Decrees, are powers which can be exercised by the
President as Commander-in-Chief only where there is a valid declaration
of Martial Law or suspension of the writ of habeas corpus.
Based on the above disquisition, it is clear that PP 1017 is not a
declaration of Martial Law. It is merely an exercise of President
Arroyo’s calling-out power for the armed forces to assist her in
preventing or suppressing lawless violence.
Second Provision: "Take Care" Power
The second provision pertains to the power of the President to ensure
that the laws be faithfully executed. This is based on Section 17, Article
VII which reads:
SEC. 17. The President shall have control of all the executive
departments, bureaus, and offices. He shall ensure that the laws be
faithfully executed.
As the Executive in whom the executive power is vested, 115 the primary
function of the President is to enforce the laws as well as to formulate
policies to be embodied in existing laws. He sees to it that all laws are
enforced by the officials and employees of his department. Before
assuming office, he is required to take an oath or affirmation to the effect
that as President of the Philippines, he will, among others, "execute its
laws."116 In the exercise of such function, the President, if needed, may
employ the powers attached to his office as the Commander-in-Chief of
all the armed forces of the country, 117 including the Philippine National
Police118 under the Department of Interior and Local Government. 119
Petitioners, especially Representatives Francis Joseph G. Escudero,
Satur Ocampo, Rafael Mariano, Teodoro Casiño, Liza Maza, and Josel
Virador argue that PP 1017 is unconstitutional as it arrogated upon
President Arroyo the power to enact laws and decrees in violation of
Section 1, Article VI of the Constitution, which vests the power to enact
laws in Congress. They assail the clause "to enforce obedience to all
the laws and to all decrees, orders and regulations promulgated by
me personally or upon my direction."
\
Petitioners’ contention is understandable. A reading of PP 1017 operative
clause shows that it was lifted120 from Former President Marcos’
Proclamation No. 1081, which partly reads:
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines by virtue of the powers vested upon me by Article VII, Section
10, Paragraph (2) of the Constitution, do hereby place the entire
Philippines as defined in Article 1, Section 1 of the Constitution under
martial law and, in my capacity as their Commander-in-Chief, do hereby
command the Armed Forces of the Philippines, to maintain law and
order throughout the Philippines, prevent or suppress all forms of
lawless violence as well as any act of insurrection or rebellion and
to enforce obedience to all the laws and decrees, orders and
regulations promulgated by me personally or upon my direction.
We all know that it was PP 1081 which granted President Marcos
legislative power. Its enabling clause states: "to enforce obedience to
all the laws and decrees, orders and regulations promulgated by me
personally or upon my direction." Upon the other hand, the enabling
clause of PP 1017 issued by President Arroyo is: to enforce obedience
to all the laws and to all decrees, orders and regulations
promulgated by me personally or upon my direction."
Is it within the domain of President Arroyo to promulgate "decrees"?
PP 1017 states in part: "to enforce obedience to all the laws
and decrees x x x promulgated by me personally or upon my
direction."
The President is granted an Ordinance Power under Chapter 2, Book III
of Executive Order No. 292 (Administrative Code of 1987). She may
issue any of the following:
Sec. 2. Executive Orders. — Acts of the President providing for rules of a
general or permanent character in implementation or execution of
constitutional or statutory powers shall be promulgated in executive
orders.
Sec. 3. Administrative Orders. — Acts of the President which relate to
particular aspect of governmental operations in pursuance of his duties
as administrative head shall be promulgated in administrative orders.
Sec. 4. Proclamations. — Acts of the President fixing a date or declaring
a status or condition of public moment or interest, upon the existence of
which the operation of a specific law or regulation is made to depend,
shall be promulgated in proclamations which shall have the force of an
executive order.
Sec. 5. Memorandum Orders. — Acts of the President on matters of
administrative detail or of subordinate or temporary interest which only
concern a particular officer or office of the Government shall be
embodied in memorandum orders.
Sec. 6. Memorandum Circulars. — Acts of the President on matters
relating to internal administration, which the President desires to bring to
the attention of all or some of the departments, agencies, bureaus or
offices of the Government, for information or compliance, shall be
embodied in memorandum circulars.
Sec. 7. General or Special Orders. — Acts and commands of the
President in his capacity as Commander-in-Chief of the Armed Forces of
the Philippines shall be issued as general or special orders.
President Arroyo’s ordinance power is limited to the foregoing issuances.
She cannot issue decrees similar to those issued by Former President
Marcos under PP 1081. Presidential Decrees are laws which are of the
same category and binding force as statutes because they were issued
by the President in the exercise of his legislative power during the period
of Martial Law under the 1973 Constitution.121
This Court rules that the assailed PP 1017 is unconstitutional
insofar as it grants President Arroyo the authority to promulgate
"decrees." Legislative power is peculiarly within the province of the
Legislature. Section 1, Article VI categorically states that "[t]he
legislative power shall be vested in the Congress of the Philippines
which shall consist of a Senate and a House of Representatives." To
be sure, neither Martial Law nor a state of rebellion nor a state of
emergency can justify President Arroyo’s exercise of legislative power by
issuing decrees.
Can President Arroyo enforce obedience to all decrees and laws through
the military?
As this Court stated earlier, President Arroyo has no authority to enact
decrees. It follows that these decrees are void and, therefore, cannot be
enforced. With respect to "laws," she cannot call the military to enforce or
implement certain laws, such as customs laws, laws governing family and
property relations, laws on obligations and contracts and the like. She
can only order the military, under PP 1017, to enforce laws pertinent to its
duty to suppress lawless violence.
Third Provision: Power to Take Over
The pertinent provision of PP 1017 states:
x x x and to enforce obedience to all the laws and to all decrees, orders,
and regulations promulgated by me personally or upon my direction; and
as provided in Section 17, Article XII of the Constitution do hereby
declare a state of national emergency.
The import of this provision is that President Arroyo, during the state of
national emergency under PP 1017, can call the military not only to
enforce obedience "to all the laws and to all decrees x x x" but also to act
pursuant to the provision of Section 17, Article XII which reads:
Sec. 17. In times of national emergency, when the public interest so
requires, the State may, during the emergency and under reasonable
terms prescribed by it, temporarily take over or direct the operation of any
privately-owned public utility or business affected with public interest.
What could be the reason of President Arroyo in invoking the above
provision when she issued PP 1017?
The answer is simple. During the existence of the state of national
emergency, PP 1017 purports to grant the President, without any
authority or delegation from Congress, to take over or direct the operation
of any privately-owned public utility or business affected with public
interest.
This provision was first introduced in the 1973 Constitution, as a product
of the "martial law" thinking of the 1971 Constitutional Convention. 122 In
effect at the time of its approval was President Marcos’ Letter of
Instruction No. 2 dated September 22, 1972 instructing the Secretary of
National Defense to take over "the management, control and operation of
the Manila Electric Company, the Philippine Long Distance Telephone
Company, the National Waterworks and Sewerage Authority, the
Philippine National Railways, the Philippine Air Lines, Air Manila (and)
Filipinas Orient Airways . . . for the successful prosecution by the
Government of its effort to contain, solve and end the present national
emergency."
Petitioners, particularly the members of the House of Representatives,
claim that President Arroyo’s inclusion of Section 17, Article XII in PP
1017 is an encroachment on the legislature’s emergency powers.
This is an area that needs delineation.
A distinction must be drawn between the President’s authority
to declare "a state of national emergency" and to exercise emergency
powers. To the first, as elucidated by the Court, Section 18, Article VII
grants the President such power, hence, no legitimate constitutional
objection can be raised. But to the second, manifold constitutional issues
arise.
Section 23, Article VI of the Constitution reads:
SEC. 23. (1) The Congress, by a vote of two-thirds of both Houses in joint
session assembled, voting separately, shall have the sole power to
declare the existence of a state of war.
(2) In times of war or other national emergency, the Congress may, by
law, authorize the President, for a limited period and subject to such
restrictions as it may prescribe, to exercise powers necessary and proper
to carry out a declared national policy. Unless sooner withdrawn by
resolution of the Congress, such powers shall cease upon the next
adjournment thereof.
It may be pointed out that the second paragraph of the above provision
refers not only to war but also to "other national emergency." If the
intention of the Framers of our Constitution was to withhold from the
President the authority to declare a "state of national emergency"
pursuant to Section 18, Article VII (calling-out power) and grant it to
Congress (like the declaration of the existence of a state of war), then the
Framers could have provided so. Clearly, they did not intend that
Congress should first authorize the President before he can declare a
"state of national emergency." The logical conclusion then is that
President Arroyo could validly declare the existence of a state of national
emergency even in the absence of a Congressional enactment.
But the exercise of emergency powers, such as the taking over of
privately owned public utility or business affected with public interest, is a
different matter. This requires a delegation from Congress.
Courts have often said that constitutional provisions in pari materia are to
be construed together. Otherwise stated, different clauses, sections, and
provisions of a constitution which relate to the same subject matter will be
construed together and considered in the light of each
other.123 Considering that Section 17 of Article XII and Section 23 of
Article VI, previously quoted, relate to national emergencies, they must
be read together to determine the limitation of the exercise of emergency
powers.
Generally, Congress is the repository of emergency powers. This is
evident in the tenor of Section 23 (2), Article VI authorizing it to delegate
such powers to the President. Certainly, a body cannot delegate a
power not reposed upon it. However, knowing that during grave
emergencies, it may not be possible or practicable for Congress to meet
and exercise its powers, the Framers of our Constitution deemed it wise
to allow Congress to grant emergency powers to the President, subject to
certain conditions, thus:
(1) There must be a war or other emergency.
(2) The delegation must be for a limited period only.
(3) The delegation must be subject to such restrictions as the
Congress may prescribe.
(4) The emergency powers must be exercised to carry out a
national policy declared by Congress.124
Section 17, Article XII must be understood as an aspect of the
emergency powers clause. The taking over of private business affected
with public interest is just another facet of the emergency powers
generally reposed upon Congress. Thus, when Section 17 states that the
"the State may, during the emergency and under reasonable terms
prescribed by it, temporarily take over or direct the operation of any
privately owned public utility or business affected with public
interest," it refers to Congress, not the President. Now, whether or not
the President may exercise such power is dependent on whether
Congress may delegate it to him pursuant to a law prescribing the
reasonable terms thereof. Youngstown Sheet & Tube Co. et al. v.
Sawyer,125 held:
It is clear that if the President had authority to issue the order he did, it
must be found in some provision of the Constitution. And it is not claimed
that express constitutional language grants this power to the President.
The contention is that presidential power should be implied from the
aggregate of his powers under the Constitution. Particular reliance is
placed on provisions in Article II which say that "The executive Power
shall be vested in a President . . . .;" that "he shall take Care that the
Laws be faithfully executed;" and that he "shall be Commander-in-Chief
of the Army and Navy of the United States.
The order cannot properly be sustained as an exercise of the President’s
military power as Commander-in-Chief of the Armed Forces. The
Government attempts to do so by citing a number of cases upholding
broad powers in military commanders engaged in day-to-day fighting in a
theater of war. Such cases need not concern us here. Even though
"theater of war" be an expanding concept, we cannot with
faithfulness to our constitutional system hold that the Commander-
in-Chief of the Armed Forces has the ultimate power as such to take
possession of private property in order to keep labor disputes from
stopping production. This is a job for the nation’s lawmakers, not
for its military authorities.
Nor can the seizure order be sustained because of the several
constitutional provisions that grant executive power to the
President. In the framework of our Constitution, the President’s
power to see that the laws are faithfully executed refutes the idea
that he is to be a lawmaker. The Constitution limits his functions in
the lawmaking process to the recommending of laws he thinks wise
and the vetoing of laws he thinks bad. And the Constitution is
neither silent nor equivocal about who shall make laws which the
President is to execute. The first section of the first article says that
"All legislative Powers herein granted shall be vested in a Congress
of the United States. . ."126
Petitioner Cacho-Olivares, et al. contends that the term "emergency"
under Section 17, Article XII refers to "tsunami," "typhoon,"
"hurricane"and"similar occurrences." This is a limited view of
"emergency."
Emergency, as a generic term, connotes the existence of conditions
suddenly intensifying the degree of existing danger to life or well-being
beyond that which is accepted as normal. Implicit in this definitions are
the elements of intensity, variety, and perception.127 Emergencies, as
perceived by legislature or executive in the United Sates since 1933,
have been occasioned by a wide range of situations, classifiable under
three (3) principal heads: a) economic,128 b) natural
disaster,129 and c) national security.130
"Emergency," as contemplated in our Constitution, is of the same
breadth. It may include rebellion, economic crisis, pestilence or epidemic,
typhoon, flood, or other similar catastrophe of nationwide proportions or
effect.131 This is evident in the Records of the Constitutional Commission,
thus:
MR. GASCON. Yes. What is the Committee’s definition of "national
emergency" which appears in Section 13, page 5? It reads:
When the common good so requires, the State may temporarily take over
or direct the operation of any privately owned public utility or business
affected with public interest.
MR. VILLEGAS. What I mean is threat from external aggression, for
example, calamities or natural disasters.
MR. GASCON. There is a question by Commissioner de los Reyes. What
about strikes and riots?
MR. VILLEGAS. Strikes, no; those would not be covered by the term
"national emergency."
MR. BENGZON. Unless they are of such proportions such that they
would paralyze government service.132
xxxxxx
MR. TINGSON. May I ask the committee if "national emergency" refers
to military national emergency or could this be economic
emergency?"
MR. VILLEGAS. Yes, it could refer to both military or economic
dislocations.
MR. TINGSON. Thank you very much.133
It may be argued that when there is national emergency, Congress may
not be able to convene and, therefore, unable to delegate to the
President the power to take over privately-owned public utility or business
affected with public interest.
In Araneta v. Dinglasan,134 this Court emphasized that legislative power,
through which extraordinary measures are exercised, remains in
Congress even in times of crisis.
"x x x
After all the criticisms that have been made against the efficiency of the
system of the separation of powers, the fact remains that the Constitution
has set up this form of government, with all its defects and shortcomings,
in preference to the commingling of powers in one man or group of men.
The Filipino people by adopting parliamentary government have given
notice that they share the faith of other democracy-loving peoples in this
system, with all its faults, as the ideal. The point is, under this framework
of government, legislation is preserved for Congress all the time, not
excepting periods of crisis no matter how serious. Never in the history of
the United States, the basic features of whose Constitution have been
copied in ours, have specific functions of the legislative branch of
enacting laws been surrendered to another department – unless we
regard as legislating the carrying out of a legislative policy according to
prescribed standards; no, not even when that Republic was fighting a
total war, or when it was engaged in a life-and-death struggle to preserve
the Union. The truth is that under our concept of constitutional
government, in times of extreme perils more than in normal
circumstances ‘the various branches, executive, legislative, and judicial,’
given the ability to act, are called upon ‘to perform the duties and
discharge the responsibilities committed to them respectively."
Following our interpretation of Section 17, Article XII, invoked by
President Arroyo in issuing PP 1017, this Court rules that such
Proclamation does not authorize her during the emergency to temporarily
take over or direct the operation of any privately owned public utility or
business affected with public interest without authority from Congress.
Let it be emphasized that while the President alone can declare a state of
national emergency, however, without legislation, he has no power to
take over privately-owned public utility or business affected with public
interest. The President cannot decide whether exceptional circumstances
exist warranting the take over of privately-owned public utility or business
affected with public interest. Nor can he determine when such
exceptional circumstances have ceased. Likewise, without
legislation, the President has no power to point out the types of
businesses affected with public interest that should be taken over. In
short, the President has no absolute authority to exercise all the powers
of the State under Section 17, Article VII in the absence of an emergency
powers act passed by Congress.
c. "AS APPLIED CHALLENGE"
One of the misfortunes of an emergency, particularly, that which pertains
to security, is that military necessity and the guaranteed rights of the
individual are often not compatible. Our history reveals that in the crucible
of conflict, many rights are curtailed and trampled upon. Here, the right
against unreasonable search and seizure; the right against
warrantless arrest; and the freedom of speech, of expression, of the
press, and of assembly under the Bill of Rights suffered the greatest
blow.
Of the seven (7) petitions, three (3) indicate "direct injury."
In G.R. No. 171396, petitioners David and Llamas alleged that, on
February 24, 2006, they were arrested without warrants on their way to
EDSA to celebrate the 20th Anniversary of People Power I. The arresting
officers cited PP 1017 as basis of the arrest.
In G.R. No. 171409, petitioners Cacho-Olivares and Tribune Publishing
Co., Inc. claimed that on February 25, 2006, the CIDG operatives "raided
and ransacked without warrant" their office. Three policemen were
assigned to guard their office as a possible "source of destabilization."
Again, the basis was PP 1017.
And in G.R. No. 171483, petitioners KMU and NAFLU-KMU et al. alleged
that their members were "turned away and dispersed" when they went to
EDSA and later, to Ayala Avenue, to celebrate the 20th Anniversary
of People Power I.
A perusal of the "direct injuries" allegedly suffered by the said petitioners
shows that they resulted from the implementation, pursuant to G.O. No.
5, of PP 1017.
Can this Court adjudge as unconstitutional PP 1017 and G.O. No 5 on
the basis of these illegal acts? In general, does the illegal implementation
of a law render it unconstitutional?
Settled is the rule that courts are not at liberty to declare statutes
invalid although they may be abused and misabused135 and may
afford an opportunity for abuse in the manner of application.136 The
validity of a statute or ordinance is to be determined from its general
purpose and its efficiency to accomplish the end desired, not from its
effects in a particular case.137 PP 1017 is merely an invocation of the
President’s calling-out power. Its general purpose is to command the
AFP to suppress all forms of lawless violence, invasion or rebellion. It had
accomplished the end desired which prompted President Arroyo to issue
PP 1021. But there is nothing in PP 1017 allowing the police, expressly
or impliedly, to conduct illegal arrest, search or violate the citizens’
constitutional rights.
Now, may this Court adjudge a law or ordinance unconstitutional on the
ground that its implementor committed illegal acts? The answer is no.
The criterion by which the validity of the statute or ordinance is to be
measured is the essential basis for the exercise of power, and not a
mere incidental result arising from its exertion.138 This is logical. Just
imagine the absurdity of situations when laws maybe declared
unconstitutional just because the officers implementing them have acted
arbitrarily. If this were so, judging from the blunders committed by
policemen in the cases passed upon by the Court, majority of the
provisions of the Revised Penal Code would have been declared
unconstitutional a long time ago.
President Arroyo issued G.O. No. 5 to carry into effect the provisions of
PP 1017. General orders are "acts and commands of the President in his
capacity as Commander-in-Chief of the Armed Forces of the Philippines."
They are internal rules issued by the executive officer to his subordinates
precisely for the proper and efficient administration of law. Such rules
and regulations create no relation except between the official who issues
them and the official who receives them.139 They are based on and are
the product of, a relationship in which power is their source, and
obedience, their object.140 For these reasons, one requirement for these
rules to be valid is that they must be reasonable, not arbitrary or
capricious.
G.O. No. 5 mandates the AFP and the PNP to immediately carry out the
"necessary and appropriate actions and measures to suppress and
prevent acts of terrorism and lawless violence."
Unlike the term "lawless violence" which is unarguably extant in our
statutes and the Constitution, and which is invariably associated with
"invasion, insurrection or rebellion," the phrase "acts of terrorism" is still
an amorphous and vague concept. Congress has yet to enact a law
defining and punishing acts of terrorism.
In fact, this "definitional predicament" or the "absence of an agreed
definition of terrorism" confronts not only our country, but the international
community as well. The following observations are quite apropos:
In the actual unipolar context of international relations, the "fight against
terrorism" has become one of the basic slogans when it comes to the
justification of the use of force against certain states and against groups
operating internationally. Lists of states "sponsoring terrorism" and of
terrorist organizations are set up and constantly being updated according
to criteria that are not always known to the public, but are clearly
determined by strategic interests.
The basic problem underlying all these military actions – or threats of the
use of force as the most recent by the United States against Iraq –
consists in the absence of an agreed definition of terrorism.
Remarkable confusion persists in regard to the legal categorization of
acts of violence either by states, by armed groups such as liberation
movements, or by individuals.
The dilemma can by summarized in the saying "One country’s terrorist is
another country’s freedom fighter." The apparent contradiction or lack of
consistency in the use of the term "terrorism" may further be
demonstrated by the historical fact that leaders of national liberation
movements such as Nelson Mandela in South Africa, Habib Bourgouiba
in Tunisia, or Ahmed Ben Bella in Algeria, to mention only a few, were
originally labeled as terrorists by those who controlled the territory at the
time, but later became internationally respected statesmen.
What, then, is the defining criterion for terrorist acts – the differentia
specifica distinguishing those acts from eventually legitimate acts of
national resistance or self-defense?
Since the times of the Cold War the United Nations Organization has
been trying in vain to reach a consensus on the basic issue of definition.
The organization has intensified its efforts recently, but has been unable
to bridge the gap between those who associate "terrorism" with any
violent act by non-state groups against civilians, state functionaries or
infrastructure or military installations, and those who believe in the
concept of the legitimate use of force when resistance against foreign
occupation or against systematic oppression of ethnic and/or religious
groups within a state is concerned.
The dilemma facing the international community can best be illustrated
by reference to the contradicting categorization of organizations and
movements such as Palestine Liberation Organization (PLO) – which is a
terrorist group for Israel and a liberation movement for Arabs and
Muslims – the Kashmiri resistance groups – who are terrorists in the
perception of India, liberation fighters in that of Pakistan – the earlier
Contras in Nicaragua – freedom fighters for the United States, terrorists
for the Socialist camp – or, most drastically, the Afghani Mujahedeen
(later to become the Taliban movement): during the Cold War period they
were a group of freedom fighters for the West, nurtured by the United
States, and a terrorist gang for the Soviet Union. One could go on and on
in enumerating examples of conflicting categorizations that cannot be
reconciled in any way – because of opposing political interests that are at
the roots of those perceptions.
How, then, can those contradicting definitions and conflicting perceptions
and evaluations of one and the same group and its actions be explained?
In our analysis, the basic reason for these striking inconsistencies lies in
the divergent interest of states. Depending on whether a state is in the
position of an occupying power or in that of a rival, or adversary, of an
occupying power in a given territory, the definition of terrorism will
"fluctuate" accordingly. A state may eventually see itself as protector of
the rights of a certain ethnic group outside its territory and will therefore
speak of a "liberation struggle," not of "terrorism" when acts of violence
by this group are concerned, and vice-versa.
The United Nations Organization has been unable to reach a decision on
the definition of terrorism exactly because of these conflicting interests of
sovereign states that determine in each and every instance how a
particular armed movement (i.e. a non-state actor) is labeled in regard to
the terrorists-freedom fighter dichotomy. A "policy of double standards"
on this vital issue of international affairs has been the unavoidable
consequence.
This "definitional predicament" of an organization consisting of sovereign
states – and not of peoples, in spite of the emphasis in the Preamble to
the United Nations Charter! – has become even more serious in the
present global power constellation: one superpower exercises the
decisive role in the Security Council, former great powers of the Cold War
era as well as medium powers are increasingly being marginalized; and
the problem has become even more acute since the terrorist attacks of
11 September 2001 I the United States.141
The absence of a law defining "acts of terrorism" may result in abuse and
oppression on the part of the police or military. An illustration is when a
group of persons are merely engaged in a drinking spree. Yet the military
or the police may consider the act as an act of terrorism and immediately
arrest them pursuant to G.O. No. 5. Obviously, this is abuse and
oppression on their part. It must be remembered that an act can only be
considered a crime if there is a law defining the same as such and
imposing the corresponding penalty thereon.
So far, the word "terrorism" appears only once in our criminal laws, i.e., in
P.D. No. 1835 dated January 16, 1981 enacted by President Marcos
during the Martial Law regime. This decree is entitled "Codifying The
Various Laws on Anti-Subversion and Increasing The Penalties for
Membership in Subversive Organizations." The word "terrorism" is
mentioned in the following provision: "That one who conspires with any
other person for the purpose of overthrowing the Government of the
Philippines x x x by force, violence, terrorism, x x x shall be punished
by reclusion temporal x x x."
P.D. No. 1835 was repealed by E.O. No. 167 (which outlaws the
Communist Party of the Philippines) enacted by President Corazon
Aquino on May 5, 1985. These two (2) laws, however, do not define "acts
of terrorism." Since there is no law defining "acts of terrorism," it is
President Arroyo alone, under G.O. No. 5, who has the discretion to
determine what acts constitute terrorism. Her judgment on this aspect is
absolute, without restrictions. Consequently, there can be indiscriminate
arrest without warrants, breaking into offices and residences, taking over
the media enterprises, prohibition and dispersal of all assemblies and
gatherings unfriendly to the administration. All these can be effected in
the name of G.O. No. 5. These acts go far beyond the calling-out power
of the President. Certainly, they violate the due process clause of the
Constitution. Thus, this Court declares that the "acts of terrorism" portion
of G.O. No. 5 is unconstitutional.
Significantly, there is nothing in G.O. No. 5 authorizing the military or
police to commit acts beyond what are necessary and appropriate to
suppress and prevent lawless violence, the limitation of their authority
in pursuing the Order. Otherwise, such acts are considered illegal.
We first examine G.R. No. 171396 (David et al.)
The Constitution provides that "the right of the people to be secured in
their persons, houses, papers and effects against unreasonable search
and seizure of whatever nature and for any purpose shall
be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge
after examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized."142 The plain import of
the language of the Constitution is that searches, seizures and arrests
are normally unreasonable unless authorized by a validly issued search
warrant or warrant of arrest. Thus, the fundamental protection given by
this provision is that between person and police must stand the protective
authority of a magistrate clothed with power to issue or refuse to issue
search warrants or warrants of arrest.143
In the Brief Account144 submitted by petitioner David, certain facts are
established: first, he was arrested without warrant; second, the PNP
operatives arrested him on the basis of PP 1017; third, he was brought at
Camp Karingal, Quezon City where he was fingerprinted, photographed
and booked like a criminal suspect; fourth,he was treated brusquely by
policemen who "held his head and tried to push him" inside an unmarked
car; fifth, he was charged with Violation of Batas Pambansa Bilang No.
880145 and Inciting to Sedition; sixth, he was detained for seven (7)
hours; and seventh,he was eventually released for insufficiency of
evidence.
Section 5, Rule 113 of the Revised Rules on Criminal Procedure
provides:
Sec. 5. Arrest without warrant; when lawful. - A peace officer or a
private person may, without a warrant, arrest a person:
(a) When, in his presence, the person to be arrested has
committed, is actually committing, or is attempting to commit an
offense.
(b) When an offense has just been committed and he has
probable cause to believe based on personal knowledge of facts
or circumstances that the person to be arrested has committed it;
and
x x x.
Neither of the two (2) exceptions mentioned above justifies petitioner
David’s warrantless arrest. During the inquest for the charges of inciting
to sedition and violation of BP 880, all that the arresting officers could
invoke was their observation that some rallyists were wearing t-shirts with
the invective "Oust Gloria Now" and their erroneous assumption that
petitioner David was the leader of the rally.146 Consequently, the Inquest
Prosecutor ordered his immediate release on the ground of insufficiency
of evidence. He noted that petitioner David was not wearing the subject t-
shirt and even if he was wearing it, such fact is insufficient to charge him
with inciting to sedition. Further, he also stated that there is insufficient
evidence for the charge of violation of BP 880 as it was not even known
whether petitioner David was the leader of the rally. 147
But what made it doubly worse for petitioners David et al. is that not only
was their right against warrantless arrest violated, but also their right to
peaceably assemble.
Section 4 of Article III guarantees:
No law shall be passed abridging the freedom of speech, of expression,
or of the press, or the right of the people peaceably to assemble and
petition the government for redress of grievances.
"Assembly" means a right on the part of the citizens to meet peaceably
for consultation in respect to public affairs. It is a necessary consequence
of our republican institution and complements the right of speech. As in
the case of freedom of expression, this right is not to be limited, much
less denied, except on a showing of a clear and present danger of a
substantive evil that Congress has a right to prevent. In other words, like
other rights embraced in the freedom of expression, the right to assemble
is not subject to previous restraint or censorship. It may not be
conditioned upon the prior issuance of a permit or authorization from the
government authorities except, of course, if the assembly is intended to
be held in a public place, a permit for the use of such place, and not for
the assembly itself, may be validly required.
The ringing truth here is that petitioner David, et al. were arrested while
they were exercising their right to peaceful assembly. They were not
committing any crime, neither was there a showing of a clear and present
danger that warranted the limitation of that right. As can be gleaned from
circumstances, the charges of inciting to sedition and violation of BP
880 were mere afterthought. Even the Solicitor General, during the oral
argument, failed to justify the arresting officers’ conduct. In De Jonge v.
Oregon,148 it was held that peaceable assembly cannot be made a crime,
thus:
Peaceable assembly for lawful discussion cannot be made a crime. The
holding of meetings for peaceable political action cannot be proscribed.
Those who assist in the conduct of such meetings cannot be branded as
criminals on that score. The question, if the rights of free speech and
peaceful assembly are not to be preserved, is not as to the auspices
under which the meeting was held but as to its purpose; not as to the
relations of the speakers, but whether their utterances transcend the
bounds of the freedom of speech which the Constitution protects. If the
persons assembling have committed crimes elsewhere, if they have
formed or are engaged in a conspiracy against the public peace and
order, they may be prosecuted for their conspiracy or other violations of
valid laws. But it is a different matter when the State, instead of
prosecuting them for such offenses, seizes upon mere participation
in a peaceable assembly and a lawful public discussion as the basis
for a criminal charge.
On the basis of the above principles, the Court likewise considers the
dispersal and arrest of the members of KMU et al. (G.R. No. 171483)
unwarranted. Apparently, their dispersal was done merely on the basis of
Malacañang’s directive canceling all permits previously issued by local
government units. This is arbitrary. The wholesale cancellation of all
permits to rally is a blatant disregard of the principle that "freedom of
assembly is not to be limited, much less denied, except on a
showing of a clear and present danger of a substantive evil that the
State has a right to prevent."149 Tolerance is the rule and limitation is
the exception. Only upon a showing that an assembly presents a clear
and present danger that the State may deny the citizens’ right to exercise
it. Indeed, respondents failed to show or convince the Court that the
rallyists committed acts amounting to lawless violence, invasion or
rebellion. With the blanket revocation of permits, the distinction between
protected and unprotected assemblies was eliminated.
Moreover, under BP 880, the authority to regulate assemblies and rallies
is lodged with the local government units. They have the power to issue
permits and to revoke such permits after due notice and hearing on the
determination of the presence of clear and present danger. Here,
petitioners were not even notified and heard on the revocation of their
permits.150 The first time they learned of it was at the time of the
dispersal. Such absence of notice is a fatal defect. When a person’s right
is restricted by government action, it behooves a democratic government
to see to it that the restriction is fair, reasonable, and according to
procedure.
G.R. No. 171409, (Cacho-Olivares, et al.) presents another facet of
freedom of speech i.e., the freedom of the press. Petitioners’ narration of
facts, which the Solicitor General failed to refute, established the
following: first, the Daily Tribune’s offices were searched without
warrant;second, the police operatives seized several materials for
publication; third, the search was conducted at about 1:00 o’ clock in the
morning of February 25, 2006; fourth, the search was conducted in the
absence of any official of the Daily Tribune except the security guard of
the building; and fifth, policemen stationed themselves at the vicinity of
the Daily Tribune offices.
Thereafter, a wave of warning came from government officials.
Presidential Chief of Staff Michael Defensor was quoted as saying that
such raid was "meant to show a ‘strong presence,’ to tell media
outlets not to connive or do anything that would help the rebels in
bringing down this government." Director General Lomibao further
stated that "if they do not follow the standards –and the standards
are if they would contribute to instability in the government, or if
they do not subscribe to what is in General Order No. 5 and Proc.
No. 1017 – we will recommend a ‘takeover.’" National
Telecommunications Commissioner Ronald Solis urged television and
radio networks to "cooperate" with the government for the duration of the
state of national emergency. He warned that his agency will not
hesitate to recommend the closure of any broadcast outfit that
violates rules set out for media coverage during times when the
national security is threatened.151
The search is illegal. Rule 126 of The Revised Rules on Criminal
Procedure lays down the steps in the conduct of search and
seizure. Section 4 requires that a search warrant be issued upon
probable cause in connection with one specific offence to be determined
personally by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce. Section 8 mandates
that the search of a house, room, or any other premise be made in the
presence of the lawful occupant thereof or any member of his family or
in the absence of the latter, in the presence of two (2) witnesses of
sufficient age and discretion residing in the same locality. And Section
9 states that the warrant must direct that it be served in the daytime,
unless the property is on the person or in the place ordered to be
searched, in which case a direction may be inserted that it be served at
any time of the day or night. All these rules were violated by the CIDG
operatives.
Not only that, the search violated petitioners’ freedom of the press. The
best gauge of a free and democratic society rests in the degree of
freedom enjoyed by its media. In the Burgos v. Chief of Staff152 this Court
held that --
As heretofore stated, the premises searched were the business and
printing offices of the "Metropolitan Mail" and the "We Forum"
newspapers. As a consequence of the search and seizure, these
premises were padlocked and sealed, with the further result that the
printing and publication of said newspapers were discontinued.
Such closure is in the nature of previous restraint or censorship xxxxxxxxx
abhorrent to the freedom of the press guaranteed under the
fundamental law, and constitutes a virtual denial of petitioners' SR. ASSO. JUSTICE PUNO:
freedom to express themselves in print. This state of being is
patently anathematic to a democratic framework where a free, alert These have been published in the past issues of the Daily Tribune; all
and even militant press is essential for the political enlightenment you have to do is to get those past issues. So why do you have to go
and growth of the citizenry. there at 1 o’clock in the morning and without any search warrant? Did
they become suddenly part of the evidence of rebellion or inciting to
While admittedly, the Daily Tribune was not padlocked and sealed like sedition or what?
the "Metropolitan Mail" and "We Forum" newspapers in the above case,
yet it cannot be denied that the CIDG operatives exceeded their SOLGEN BENIPAYO:
enforcement duties. The search and seizure of materials for publication,
the stationing of policemen in the vicinity of the The Daily Tribune offices,
Well, it was the police that did that, Your Honor. Not upon my
and the arrogant warning of government officials to media, are plain
instructions.
censorship. It is that officious functionary of the repressive government
who tells the citizen that he may speak only if allowed to do so, and no
more and no less than what he is permitted to say on pain of punishment SR. ASSO. JUSTICE PUNO:
should he be so rash as to disobey.153 Undoubtedly, the The Daily
Tribune was subjected to these arbitrary intrusions because of its anti- Are you saying that the act of the policeman is illegal, it is not based on
government sentiments. This Court cannot tolerate the blatant disregard any law, and it is not based on Proclamation 1017.
of a constitutional right even if it involves the most defiant of our citizens.
Freedom to comment on public affairs is essential to the vitality of a SOLGEN BENIPAYO:
representative democracy. It is the duty of the courts to be watchful for
the constitutional rights of the citizen, and against any stealthy It is not based on Proclamation 1017, Your Honor, because there is
encroachments thereon. The motto should always be obsta principiis.154 nothing in 1017 which says that the police could go and inspect and
gather clippings from Daily Tribune or any other newspaper.
Incidentally, during the oral arguments, the Solicitor General admitted
that the search of the Tribune’s offices and the seizure of its materials for SR. ASSO. JUSTICE PUNO:
publication and other papers are illegal; and that the same are
inadmissible "for any purpose," thus: Is it based on any law?

JUSTICE CALLEJO: SOLGEN BENIPAYO:

You made quite a mouthful of admission when you said that the As far as I know, no, Your Honor, from the facts, no.
policemen, when inspected the Tribune for the purpose of gathering
evidence and you admitted that the policemen were able to get the
SR. ASSO. JUSTICE PUNO:
clippings. Is that not in admission of the admissibility of these clippings
that were taken from the Tribune?
So, it has no basis, no legal basis whatsoever?
SOLICITOR GENERAL BENIPAYO:
SOLGEN BENIPAYO:
Under the law they would seem to be, if they were illegally seized, I think
and I know, Your Honor, and these are inadmissible for any purpose. 155 Maybe so, Your Honor. Maybe so, that is why I said, I don’t know if it is
premature to say this, we do not condone this. If the people who have
been injured by this would want to sue them, they can sue and there
are remedies for this.156
Likewise, the warrantless arrests and seizures executed by the police
were, according to the Solicitor General, illegal and cannot be condoned,
thus:
CHIEF JUSTICE PANGANIBAN:
There seems to be some confusions if not contradiction in your theory.
SOLICITOR GENERAL BENIPAYO:
I don’t know whether this will clarify. The acts, the supposed illegal or
unlawful acts committed on the occasion of 1017, as I said, it cannot be
condoned. You cannot blame the President for, as you said, a
misapplication of the law. These are acts of the police officers, that is
their responsibility.157
The Dissenting Opinion states that PP 1017 and G.O. No. 5 are
constitutional in every aspect and "should result in no constitutional or
statutory breaches if applied according to their letter."
The Court has passed upon the constitutionality of these issuances. Its
ratiocination has been exhaustively presented. At this point, suffice it to
reiterate that PP 1017 is limited to the calling out by the President of the
military to prevent or suppress lawless violence, invasion or rebellion.
When in implementing its provisions, pursuant to G.O. No. 5, the military
and the police committed acts which violate the citizens’ rights under the
Constitution, this Court has to declare such acts unconstitutional and
illegal.
In this connection, Chief Justice Artemio V. Panganiban’s concurring
opinion, attached hereto, is considered an integral part of this ponencia.
SUMMATION
In sum, the lifting of PP 1017 through the issuance of PP 1021 – a
supervening event – would have normally rendered this case moot and
academic. However, while PP 1017 was still operative, illegal acts were
committed allegedly in pursuance thereof. Besides, there is no guarantee
that PP 1017, or one similar to it, may not again be issued. Already, there
have been media reports on April 30, 2006 that allegedly PP 1017 would
be reimposed "if the May 1 rallies" become "unruly and violent."
Consequently, the transcendental issues raised by the parties should not
be "evaded;" they must now be resolved to prevent future constitutional
aberration.
The Court finds and so holds that PP 1017 is constitutional insofar as it
constitutes a call by the President for the AFP to prevent or
suppress lawless violence. The proclamation is sustained by Section
18, Article VII of the Constitution and the relevant jurisprudence
discussed earlier. However, PP 1017’s extraneous provisions giving the
President express or implied power (1) to issue decrees; (2) to direct the
AFP to enforce obedience to all laws even those not related to lawless
violence as well as decrees promulgated by the President; and (3) to
impose standards on media or any form of prior restraint on the press,
are ultra vires and unconstitutional. The Court also rules that under
Section 17, Article XII of the Constitution, the President, in the absence of
a legislation, cannot take over privately-owned public utility and private
business affected with public interest.
In the same vein, the Court finds G.O. No. 5 valid. It is an Order issued
by the President – acting as Commander-in-Chief – addressed to
subalterns in the AFP to carry out the provisions of PP 1017.
Significantly, it also provides a valid standard – that the military and the
police should take only the "necessary and appropriate actions and
measures to suppress and prevent acts of lawless violence."But the
words "acts of terrorism" found in G.O. No. 5 have not been legally
defined and made punishable by Congress and should thus be deemed
deleted from the said G.O. While "terrorism" has been denounced
generally in media, no law has been enacted to guide the military, and
eventually the courts, to determine the limits of the AFP’s authority in
carrying out this portion of G.O. No. 5.
On the basis of the relevant and uncontested facts narrated earlier, it is
also pristine clear that (1) the warrantless arrest of petitioners Randolf S.
David and Ronald Llamas; (2) the dispersal of the rallies and warrantless
arrest of the KMU and NAFLU-KMU members; (3) the imposition of
standards on media or any prior restraint on the press; and (4) the
warrantless search of the Tribune offices and the whimsical seizures of
some articles for publication and other materials, are not authorized by
the Constitution, the law and jurisprudence. Not even by the valid
provisions of PP 1017 and G.O. No. 5.
Other than this declaration of invalidity, this Court cannot impose any
civil, criminal or administrative sanctions on the individual police officers
concerned. They have not been individually identified and given their day
in court. The civil complaints or causes of action and/or relevant criminal
Informations have not been presented before this Court. Elementary due
process bars this Court from making any specific pronouncement of civil,
criminal or administrative liabilities.
committing acts constituting lawless violence, invasion or rebellion and
violating BP 880; the imposition of standards on media or any form of
prior restraint on the press, as well as the warrantless search of
the Tribune offices and whimsical seizure of its articles for publication and
other materials, are declared UNCONSTITUTIONAL.

It is well to remember that military power is a means to an end and No costs.

substantive civil rights are ends in themselves. How to give the
military the power it needs to protect the Republic without SO ORDERED.
unnecessarily trampling individual rights is one of the eternal
balancing tasks of a democratic state.During emergency,
governmental action may vary in breadth and intensity from normal times,
yet they should not be arbitrary as to unduly restrain our people’s liberty.

Perhaps, the vital lesson that we must learn from the theorists who
studied the various competing political philosophies is that, it is possible
to grant government the authority to cope with crises without
surrendering the two vital principles of constitutionalism: the
maintenance of legal limits to arbitrary power, and political
responsibility of the government to the governed.158

WHEREFORE, the Petitions are partly granted. The Court rules that PP
1017 is CONSTITUTIONAL insofar as it constitutes a call by President
Gloria Macapagal-Arroyo on the AFP to prevent or suppress lawless
violence. However, the provisions of PP 1017 commanding the AFP to
enforce laws not related to lawless violence, as well as decrees
promulgated by the President, are declared UNCONSTITUTIONAL. In
addition, the provision in PP 1017 declaring national emergency under
Section 17, Article VII of the Constitution is CONSTITUTIONAL, but such
declaration does not authorize the President to take over privately-owned
public utility or business affected with public interest without prior
legislation.

G.O. No. 5 is CONSTITUTIONAL since it provides a standard by which

the AFP and the PNP should implement PP 1017, i.e. whatever is
"necessary and appropriate actions and measures to suppress and
prevent acts of lawless violence." Considering that "acts of terrorism"
have not yet been defined and made punishable by the Legislature, such
portion of G.O. No. 5 is declared UNCONSTITUTIONAL.

The warrantless arrest of Randolf S. David and Ronald Llamas; the

dispersal and warrantless arrest of the KMU and NAFLU-KMU members
during their rallies, in the absence of proof that these petitioners were
G.R. No. 162272 April 7, 2009
SANTIAGO C. DIVINAGRACIA, Petitioner,
vs.
CONSOLIDATED BROADCASTING SYSTEM, INC. and PEOPLE'S
BROADCASTING SERVICE, INC., Respondents.
DECISION
TINGA, J.:
Does the National Telecommunications Commission (NTC) have
jurisdiction over complaints seeking the cancellation of certificates of
public convenience (CPCs) and other licenses it had issued to the
holders of duly-issued legislative franchises on the ground that the
franchisees had violated the terms of their franchises? The Court, in
resolving that question, takes the opportunity to elaborate on the dynamic
behind the regulation of broadcast media in the Philippines, particularly
the interrelationship between the twin franchise and licensing
requirements.
I.
Respondents Consolidated Broadcasting System, Inc. (CBS) and
People’s Broadcasting Service, Inc. (PBS) were incorporated in 1961 and
1965, respectively. Both are involved in the operation of radio
broadcasting services in the Philippines, they being the grantees of
legislative franchises by virtue of two laws, Republic Act (R.A.) No. 7477
and R.A. No. 7582. R.A. No. 7477, enacted on 5 May 1992, granted PBS
a legislative franchise to construct, install, maintain and operate radio and
television stations within the Philippines for a period of 25 years. R.A. No.
7582, enacted on 27 May 1992, extended CBS’s previous legislative
franchise1 to operate radio stations for another 25 years. The CBS and
PBS radio networks are two of the three networks that comprise the well-
known "Bombo Radyo Philippines."2
Section 9 of R.A. No. 7477 and Section 3 of R.A. No. 7582 contain a
common provision predicated on the "constitutional mandate to
democratize ownership of public utilities."3 The common provision states:
SEC. 9. Democratization of ownership.― In compliance with the
constitutional mandate to democratize ownership of public utilities, the
herein grantee shall make public offering through the stock exchanges of
at least thirty percent (30%) of its common stocks within a period of three
(3) years from the date of effectivity of this Act: Provided, That no single
person or entity shall be allowed to own more than five percent (5%) of
the stock offerings.4
It further appears that following the enactment of these franchise laws,
the NTC issued four (4) Provisional Authorities to PBS and six (6)
Provisional Authorities to CBS, allowing them to install, operate and
maintain various AM and FM broadcast stations in various locations
throughout the nation.5 These Provisional Authorities were issued
between 1993 to 1998, or after the enactment of R.A. No. 7477 and R.A.
No. 7582.
Petitioner Santiago C. Divinagracia6 filed two complaints both dated 1
March 1999 with the NTC, respectively lodged against PBS7 and
CBS.8 He alleged that he was "the actual and beneficial owner of Twelve
percent (12%) of the shares of stock" of PBS and CBS separately, 9 and
that despite the provisions in R.A. No. 7477 and R.A. No. 7582
mandating the public offering of at least 30% of the common stocks of
PBS and CBS, both entities had failed to make such offering. Thus,
Divinagracia commonly argued in his complaints that the failure on the
part of PBS and CBS "to comply with the mandate of their legislative
franchise is a misuse of the franchise conferred upon it by law and it
continues to exercise its franchise in contravention of the law to the
detriment of the general public and of complainant who are unable to
enjoy the benefits being offered by a publicly listed company."10 He thus
prayed for the cancellation of all the Provisional Authorities or CPCs of
PBS and CBS on account of the alleged violation of the conditions set
therein, as well as in its legislative franchises. 11
On 1 August 2000, the NTC issued a consolidated decision dismissing
both complaints.12 While the NTC posited that it had full jurisdiction to
revoke or cancel a Provisional Authority or CPC for violations or
infractions of the terms and conditions embodied therein, 13 it held that the
complaints actually constituted collateral attacks on the legislative
franchises of PBS and CBS since the sole issue for determination was
whether the franchisees had violated the mandate to democratize
ownership in their respective legislative franchises. The NTC ruled that it
was not competent to render a ruling on that issue, the same being more
properly the subject of an action for quo warranto to be commenced by
the Solicitor General in the name of the Republic of the Philippines,
pursuant to Rule 66 of the Rules of Court. 14
After the NTC had denied Divinagracia’s motion for reconsideration,15 he
filed a petition for review under Rule 43 of the Rules of Court with the
Court of Appeals.16 On 18 February 2004, the Court of Appeals rendered
a decision17 upholding the NTC. The appellate court agreed with the
earlier conclusion that the complaints were indeed a collateral attack on
the legislative franchises of CBS and PBS and that a quo warranto action
was the proper mode to thresh out the issues raised in the complaints.
Hence this petition, which submits as the principal issue, whether the
NTC, with its retinue of regulatory powers, is powerless to cancel
Provisional Authorities and Certificates of Public Convenience it issued to
legislative franchise-holders. That central issue devolves into several
narrower arguments, some of which hinge on the authority of the NTC to
cancel the very Provisional Authorities and CPCs which it is empowered
to issue, as distinguished from the legislative franchise itself, the
cancellation of which Divinagracia points out was not the relief he had
sought from the NTC. Questions are raised as to whether the complaints
did actually constitute a collateral attack on the legislative franchises.
Yet this case ultimately rests to a large degree on fundamentals.
Divinagracia’s case rotates on the singular thesis that the NTC has the
power to cancel Provisional Authorities and CPCs, or in effect, the power
to cancel the licenses that allow broadcast stations to operate. The NTC,
in its assailed Decision, expressly admits that it has such power even as
it refrained from exercising the same.18 The Court has yet to engage in a
deep inquiry into the question of whether the NTC has the power to
cancel the operating licenses of entities to whom Congress has issued
franchises to operate broadcast stations, especially on account of an
alleged violation of the terms of their franchises. This is the opportune
time to examine the issue.
II.
To fully understand the scope and dimensions of the regulatory realm of
the NTC, it is essential to review the legal background of the regulation
process. As operative fact, any person or enterprise which wishes to
operate a broadcast radio or television station in the Philippines has to
secure a legislative franchise in the form of a law passed by Congress,
and thereafter a license to operate from the NTC.
The franchise requirement traces its genesis to Act No. 3846, otherwise
known as the Radio Control Act, enacted in 1931.19 Section 1 thereof
provided that "[n]o person, firm, company, association or corporation
shall construct, install, establish, or operate x x x a radio broadcasting
station, without having first obtained a franchise therefor from the
National Assembly x x x"20 Section 2 of the law prohibited the
construction or installation of any station without a permit granted by the
Secretary of Public Works and Communication, and the operation of such
station without a license issued by the same Department Secretary. 21 The
law likewise empowered the Secretary of Public Works and
Communication "to regulate the establishment, use, and operation of all
radio stations and of all forms of radio communications and transmissions
within the Philippine Islands and to issue such rules and regulations as
may be necessary."22
Noticeably, our Radio Control Act was enacted a few years after the
United States Congress had passed the Radio Act of 1927. American
broadcasters themselves had asked their Congress to step in and
regulate the radio industry, which was then in its infancy. The absence of
government regulation in that market had led to the emergence of
hundreds of radio broadcasting stations, each using frequencies of their
choice and changing frequencies at will, leading to literal chaos on the
airwaves. It was the Radio Act of 1927 which introduced a licensing
requirement for American broadcast stations, to be overseen eventually
by the Federal Communications Commission (FCC).23
This pre-regulation history of radio broadcast stations illustrates the
continuing necessity of a government role in overseeing the broadcast
media industry, as opposed to other industries such as print media and
the Internet.24 Without regulation, the result would be a free-for-all market
with rival broadcasters able with impunity to sabotage the use by others
of the airwaves.25 Moreover, the airwaves themselves the very medium
utilized by broadcast―are by their very nature not susceptible to
appropriation, much less be the object of any claim of private or exclusive
ownership. No private individual or enterprise has the physical means,
acting alone to actualize exclusive ownership and use of a particular
frequency. That end, desirable as it is among broadcasters, can only be
accomplished if the industry itself is subjected to a regime of government
regulation whereby broadcasters receive entitlement to exclusive use of
their respective or particular frequencies, with the State correspondingly
able by force of law to confine all broadcasters to the use of the
frequencies assigned to them.
Still, the dominant jurisprudential rationale for state regulation of
broadcast media is more sophisticated than a mere recognition of a need
for the orderly administration of the airwaves. After all, a united broadcast
industry can theoretically achieve that goal through determined self-
regulation. The key basis for regulation is rooted in empiricism – "that
broadcast frequencies are a scarce resource whose use could be
regulated and rationalized only by the Government." This concept was
first introduced in jurisprudence in the U.S. case of Red Lion v. Federal
Communications Commission.26
Red Lion enunciated the most comprehensive statement of the necessity
of government oversight over broadcast media. The U.S. Supreme Court
observed that within years from the introduction of radio broadcasting in
the United States, "it became apparent that broadcast frequencies
constituted a scarce resource whose use could be regulated and
rationalized only by the Government… without government control, the
medium would be of little use because of the cacophony of competing
voices, none of which could be clearly and predictably heard." The
difficulties posed by spectrum scarcity was concretized by the U.S. High
Court in this manner:
Scarcity is not entirely a thing of the past. Advances in technology, such
as microwave transmission, have led to more efficient utilization of the
frequency spectrum, but uses for that spectrum have also grown apace.
Portions of the spectrum must be reserved for vital uses unconnected
with human communication, such as radio-navigational aids used by
aircraft and vessels. Conflicts have even emerged between such vital
functions as defense preparedness and experimentation in methods of
averting midair collisions through radio warning devices. "Land mobile
services" such as police, ambulance, fire department, public utility, and
other communications systems have been occupying an increasingly
crowded portion of the frequency spectrum and there are, apart from
licensed amateur radio operators' equipment, 5,000,000 transmitters
operated on the "citizens' band" which is also increasingly congested.
Among the various uses for radio frequency space, including marine,
aviation, amateur, military, and common carrier users, there are easily
enough claimants to permit use of the whole with an even smaller
allocation to broadcast radio and television uses than now
exists.(citations omitted)27
After interrelating the premise of scarcity of resources with the First
Amendment rights of broadcasters, Red Lion concluded that government
regulation of broadcast media was a necessity:
Where there are substantially more individuals who want to broadcast
than there are frequencies to allocate, it is idle to posit an unabridgeable
First Amendment right to broadcast comparable to the right of every
individual to speak, write, or publish. If 100 persons want broadcast [395
U.S. 367, 389] licenses but there are only 10 frequencies to allocate, all
of them may have the same "right" to a license; but if there is to be any
effective communication by radio, only a few can be licensed and the rest
must be barred from the airwaves. It would be strange if the First
Amendment, aimed at protecting and furthering communications,
prevented the Government from making radio communication possible by
requiring licenses to broadcast and by limiting the number of licenses so
as not to overcrowd the spectrum.
This has been the consistent view of the Court. Congress unquestionably
has the power to grant and deny licenses and to eliminate existing
stations. No one has a First Amendment right to a license or to
monopolize a radio frequency; to deny a station license because "the
public interest" requires it "is not a denial of free speech."
By the same token, as far as the First Amendment is concerned those
who are licensed stand no better than those to whom licenses are
refused. A license permits broadcasting, but the licensee has no
constitutional right to be the one who holds the license or to monopolize a
radio frequency to the exclusion of his fellow citizens. There is nothing in
the First Amendment which prevents the Government from requiring a
licensee to share his frequency with others and to conduct himself as a
proxy or fiduciary with obligations to present those views and voices
which are representative of his community and which would otherwise, by
necessity, be barred from the airwaves. 28
xxxx
Rather than confer frequency monopolies on a relatively small number of
licensees, in a Nation of 200,000,000, the Government could surely have
decreed that each frequency should be shared among all or some of
those who wish to use it, each being assigned a portion of the broadcast
day or the broadcast week. The ruling and regulations at issue here do
not go quite so far. They assert that under specified circumstances, a
licensee must offer to make available a reasonable amount of broadcast
time to those who have a view different from that which has already been
expressed on his station. The expression of a political endorsement, or of
a personal attack while dealing with a controversial public issue, simply
triggers this time sharing. As we have said, the First Amendment confers
no right on licensees to prevent others from broadcasting on "their"
frequencies and no right to an unconditional monopoly of a scarce
resource which the Government has denied others the right to use.
In terms of constitutional principle, and as enforced sharing of a scarce
resource, the personal attack and political editorial rules are
indistinguishable from the equal-time provision of §315, a specific
enactment of Congress requiring stations to set aside reply time under
specified circumstances and to which the fairness doctrine and these
constituent regulations are important complements. That provision, which
has been part of the law since 1927, Radio Act of 1927, §18, 44 Stat.
1170, has been held valid by this Court as an obligation of the licensee
relieving him of any power in any way to prevent or censor the broadcast,
and thus insulating him from liability for defamation. The constitutionality
of the statute under the First Amendment was unquestioned.(citations
omitted)29
As made clear in Red Lion, the scarcity of radio frequencies made it
necessary for the government to step in and allocate frequencies to
competing broadcasters. In undertaking that function, the government is
impelled to adjudge which of the competing applicants are worthy of
frequency allocation. It is through that role that it becomes legally viable
for the government to impose its own values and goals through a
regulatory regime that extends beyond the assignation of frequencies,
notwithstanding the free expression guarantees enjoyed by broadcasters.
As the government is put in a position to determine who should be worthy
to be accorded the privilege to broadcast from a finite and limited
spectrum, it may impose regulations to see to it that broadcasters
promote the public good deemed important by the State, and to withdraw
that privilege from those who fall short of the standards set in favor of
other worthy applicants.
Such conditions are peculiar to broadcast media because of the scarcity
of the airwaves. Indeed, any attempt to impose such a regulatory regime
on a medium that is not belabored under similar physical conditions, such
as print media, will be clearly antithetical to democratic values and the
free expression clause. This Court, which has adopted the "scarcity of
resources" doctrine in cases such as Telecom. & Broadcast Attys. of the
Phils., Inc. v. COMELEC,30 emphasized the distinction citing Red Lion:
Petitioners complain that B.P. Blg. 881, §92 singles out radio and
television stations to provide free air time. They contend that newspapers
and magazines are not similarly required as, in fact, in Philippine Press
Institute v. COMELEC we upheld their right to the payment of just
compensation for the print space they may provide under §90.
The argument will not bear analysis. It rests on the fallacy that broadcast
media are entitled to the same treatment under the free speech
guarantee of the Constitution as the print media. There are important
differences in the characteristics of the two media, however, which justify
their differential treatment for free speech purposes. Because of the
physical limitations of the broadcast spectrum, the government must, of
necessity, allocate broadcast frequencies to those wishing to use them.
There is no similar justification for government allocation and regulation
of the print media.
In the allocation of limited resources, relevant conditions may validly be
imposed on the grantees or licensees. The reason for this is that, as
already noted, the government spends public funds for the allocation and
regulation of the broadcast industry, which it does not do in the case of
the print media. To require the radio and television broadcast industry to
provide free air time for the COMELEC Time is a fair exchange for what
the industry gets.31
Other rationales may have emerged as well validating state regulation of
broadcast media,32 but the reality of scarce airwaves remains the primary,
indisputable and indispensable justification for the government regulatory
role. The integration of the scarcity doctrine into the jurisprudence on
broadcast media illustrates how the libertarian ideal of the free
expression clause may be tempered and balanced by actualities in the
real world while preserving the core essence of the constitutional
guarantee. Indeed, without government regulation of the broadcast
spectrum, the ability of broadcasters to clearly express their views would
be inhibited by the anarchy of competition. Since the airwaves
themselves are not susceptible to physical appropriation and private
ownership, it is but indispensable that the government step in as the
guardian of the spectrum.
Reference to the scarcity doctrine is necessary to gain a full
understanding of the paradigm that governs the state regulation of
broadcast media. That paradigm, as it exists in the United States, is
contextually similar to our own, except in one very crucial regard – the
dual franchise/license requirements we impose.
III.
Recall that the Radio Control Act specifically required the obtention of a
legislative franchise for the operation of a radio station in the Philippines.
When the Public Service Act was enacted in 1936, the Public Service
Commission (PSC) was vested with jurisdiction over "public services,"
including over "wire or wireless broadcasting stations." 33 However, among
those specifically exempted from the regulatory reach of the PSC were
"radio companies, except with respect to the fixing of rates." 34 Thus,
following the Radio Control Act, the administrative regulation of "radio
companies" remained with the Secretary of Public Works and
Communications. It appears that despite the advent of commercial
television in the 1950s, no corresponding amendment to either the Radio
Control Act or the Public Service Act was passed to reflect that new
technology then.
Shortly after the 1972 declaration of martial law, President Marcos issued
Presidential Decree (P.D.) No. 1, which allocated to the Board of
Communications the authority to issue CPCs for the operation of radio
and television broadcasting systems and to grant permits for the use of
radio frequencies for such broadcasting systems. In 1974, President
Marcos promulgated Presidential Decree No. 576-A, entitled "Regulating
the Ownership and Operation of Radio and Television Stations and for
other Purposes." Section 6 of that law reads:
Section 6. All franchises, grants, licenses, permits, certificates or other
forms of authority to operate radio or television broadcasting systems
shall terminate on December 31, 1981. Thereafter, irrespective of any
franchise, grants, license, permit, certificate or other forms of authority to
operate granted by any office, agency or person, no radio or television
station shall be authorized to operated without the authority of the Board
of Communications and the Secretary of Public Works and
Communications or their successors who have the right and authority to
assign to qualified parties frequencies, channels or other means of
identifying broadcasting systems; Provided, however, that any conflict
over, or disagreement with a decision of the aforementioned authorities
may be appealed finally to the Office of the President within fifteen days
from the date the decision is received by the party in interest.
A few years later, President Marcos promulgated Executive Order (E.O.)
No. 546, establishing among others the National Telecommunications
Commission. Section 15 thereof enumerates the various functions of the
NTC.
Section 15. Functions of the Commission.― The Commission shall
exercise the following functions:
a. Issue Certificate of Public Convenience for the operation of
communications utilities and services, radio communications
systems, wire or wireless telephone or telegraph systems, radio
and television broadcasting system and other similar public
utilities;
b. Establish, prescribe and regulate areas of operation of
particular operators of public service communications; and
determine and prescribe charges or rates pertinent to the
operation of such public utility facilities and services except in
cases where charges or rates are established by international
bodies or associations of which the Philippines is a participating
member or by bodies recognized by the Philippine Government
as the proper arbiter of such charges or rates;
c. Grant permits for the use of radio frequencies for wireless
telephone and telegraph systems and radio communication
systems including amateur radio stations and radio and television
broadcasting systems;
d. Sub-allocate series of frequencies of bands allocated by the
International Telecommunications Union to the specific services;
e. Establish and prescribe rules, regulations, standards,
specifications in all cases related to the issued Certificate of
Public Convenience and administer and enforce the same;
f. Coordinate and cooperate with government agencies and other
entities concerned with any aspect involving communications with
a view to continuously improve the communications service in the
country;
g. Promulgate such rules and regulations, as public safety and
interest may require, to encourage a larger and more effective
use of communications, radio and television broadcasting
facilities, and to maintain effective competition among private
entities in these activities whenever the Commission finds it
reasonably feasible;
h. Supervise and inspect the operation of radio stations and
telecommunications facilities;
i. Undertake the examination and licensing of radio operators;
j. Undertake, whenever necessary, the registration of radio
transmitters and transceivers; and
 k. Perform such other functions as may be prescribed by law.
These enactments were considered when in 2003 the Court definitively
resolved that the operation of a radio or television station does require a
congressional franchise. In Associated Communications & Wireless
Services v. NTC,35 the Court took note of the confusion then within the
broadcast industry as to whether the franchise requirement first ordained
in the 1931 Radio Control Act remained extant given the enactment of
P.D. No. 576-A in 1974 and E.O. No. 546 in 1979. Notably, neither law
had specifically required legislative franchises for the operation of
broadcast stations. Nonetheless, the Court noted that Section 1 of P.D.
No. 576-A had expressly referred to the franchise requirement in stating
that "[n]o radio station or television channel may obtain a franchise
unless it has sufficient capital on the basis of equity for its operation for at
least one year… ."36 Section 6 of that law made a similar reference to the
franchise requirement.37 From those references, the Court concluded that
the franchise requirement under the Radio Control Act was not repealed
by P.D. No. 576-A.38
Turning to E.O. No. 546, the Court arrived at a similar conclusion, despite
a Department of Justice Opinion stating that the 1979 enactment had
dispensed with the congressional franchise requirement. The Court
clarified that the 1989 ruling in Albano v. Reyes, to the effect that
"franchises issued by Congress are not required before each and every
public utility may operate" did not dispense with the franchise
requirement insofar as broadcast stations are concerned.
Our ruling in Albano that a congressional franchise is not required before
"each and every public utility may operate" should be viewed in its proper
light. Where there is a law such as P.D. No. 576-A which requires a
franchise for the operation of radio and television stations, that law must
be followed until subsequently repealed. As we have earlier shown,
however, there is nothing in the subsequent E.O. No. 546 which evinces
an intent to dispense with the franchise requirement. In contradistinction
with the case at bar, the law applicable in Albano, i.e., E.O. No. 30, did
not require a franchise for the Philippine Ports Authority to take over,
manage and operate the Manila International Port Complex and
undertake the providing of cargo handling and port related services
thereat. Similarly, in Philippine Airlines, Inc. v. Civil Aeronautics Board, et
al., we ruled that a legislative franchise is not necessary for the operation
of domestic air transport because "there is nothing in the law nor in the
Constitution which indicates that a legislative franchise is an
indispensable requirement for an entity to operate as a domestic air
transport operator." Thus, while it is correct to say that specified agencies
in the Executive Branch have the power to issue authorization for certain
classes of public utilities, this does not mean that the authorization or
CPC issued by the NTC dispenses with the requirement of a franchise as
this is clearly required under P.D. No. 576-A.39
The Court further observed that Congress itself had accepted it as a
given that a legislative franchise is still required to operate a broadcasting
station in the Philippines.
That the legislative intent is to continue requiring a franchise for the
operation of radio and television broadcasting stations is clear from the
franchises granted by Congress after the effectivity of E.O. No. 546 in
1979 for the operation of radio and television stations. Among these are:
(1) R.A. No. 9131 dated April 24, 2001, entitled "An Act Granting the
Iddes Broadcast Group, Inc., a Franchise to Construct, Install, Establish,
Operate and Maintain Radio and Television Broadcasting Stations in the
Philippines"; (2) R.A. No. 9148 dated July 31, 2001, entitled "An Act
Granting the Hypersonic Broadcasting Center, Inc., a Franchise to
Construct, Install, Establish, Operate and Maintain Radio Broadcasting
Stations in the Philippines;" and (3) R.A. No. 7678 dated February 17,
1994, entitled "An Act Granting the Digital Telecommunication
Philippines, Incorporated, a Franchise to Install, Operate and Maintain
Telecommunications Systems Throughout the Philippines." All three
franchises require the grantees to secure a CPCN/license/permit to
construct and operate their stations/systems. Likewise, the Tax Reform
Act of 1997 provides in Section 119 for tax on franchise of radio and/or
television broadcasting companies x x x 40
Associated Communications makes clear that presently broadcast
stations are still required to obtain a legislative franchise, as they have
been so since the passage of the Radio Control Act in 1931. By virtue of
this requirement, the broadcast industry falls within the ambit of Section
11, Article XII of the 1987 Constitution, the one constitutional provision
concerned with the grant of franchises in the Philippines. 41 The
requirement of a legislative franchise likewise differentiates the Philippine
broadcast industry from that in America, where there is no need to secure
a franchise from the U.S. Congress.
It is thus clear that the operators of broadcast stations in the Philippines
must secure a legislative franchise, a requirement imposed by the Radio
Control Act of 1931 and accommodated under the 1987 Constitution. At
the same time, the Court in Associated Communications referred to
another form of "permission" required of broadcast stations, that is the
CPC issued by the NTC. What is the source of such requirement?
The Radio Control Act had also obliged radio broadcast stations to
secure a permit from the Secretary of Commerce and Industry42 prior to
the construction or installation of any station. 43 Said Department
Secretary was also empowered to regulate "the establishment, use and
operation of all radio stations and of all forms of radio communications
and
transmission within the Philippines."44 Among the specific powers granted
to the Secretary over radio stations are the approval or disapproval of
any application for the construction, installation, establishment or
operation of a radio station45 and the approval or disapproval of any
application for renewal of station or operation license. 46
As earlier noted, radio broadcasting companies were exempted from the
jurisdiction of the defunct Public Service Commission except with respect
to their rates; thus, they did not fall within the same regulatory regime as
other public services, the regime which was characterized by the need for
CPC or CPCN. However, following the Radio Control Act, it became clear
that radio broadcast companies need to obtain a similar license from the
government in order to operate, at that time from the Department of
Public Works and Communications.
Then, as earlier noted, in 1972, President Marcos through P.D. No. 1,
transferred to the Board of Communications the function of issuing CPCs
for the operation of radio and television broadcasting systems, as well as
the granting of permits for the use of radio frequencies for such
broadcasting systems. With the creation of the NTC, through E.O. No.
546 in 1979, that agency was vested with the power to "[i]ssue
certificate[s] of public convenience for the operation of… radio and
television broadcasting system[s]."47 That power remains extant and
undisputed to date.
This much thus is clear. Broadcast and television stations are required to
obtain a legislative franchise, a requirement imposed by the Radio
Control Act and affirmed by our ruling in Associated Broadcasting. After
securing their legislative franchises, stations are required to obtain CPCs
from the NTC before they can operate their radio or television
broadcasting systems. Such requirement while traceable also to the
Radio Control Act, currently finds its basis in E.O. No. 546, the law
establishing the NTC.
From these same legal premises, the next and most critical question is
whether the NTC has the power to cancel the CPCs it has issued to
legislative franchisees.
IV.
The complexities of our dual franchise/license regime for broadcast
media should be understood within the context of separation of powers.
The right of a particular entity to broadcast over the airwaves is
established by law —i.e., the legislative franchise — and determined by
Congress, the branch of government tasked with the creation of rights
and obligations. As with all other laws passed by Congress, the function
of the executive branch of government, to which the NTC belongs, is the
implementation of the law. In broad theory, the legal obligation of the
NTC once Congress has established a legislative franchise for a
broadcast media station is to facilitate the operation by the franchisee of
its broadcast stations. However, since the public administration of the
airwaves is a requisite for the operation of a franchise and is moreover a
highly technical function, Congress has delegated to the NTC the task of
administration over the broadcast spectrum, including the determination
of available bandwidths and the allocation of such available bandwidths
among the various legislative franchisees. The licensing power of the
NTC thus arises from the necessary delegation by Congress of legislative
power geared towards the orderly exercise by franchisees of the rights
granted them by Congress.
Congress may very well in its wisdom impose additional obligations on
the various franchisees and accordingly delegate to the NTC the power
to ensure that the broadcast stations comply with their obligations under
the law. Because broadcast media enjoys a lesser degree of free
expression protection as compared to their counterparts in print, these
legislative restrictions are generally permissible under the Constitution.
Yet no enactment of Congress may contravene the Constitution and its
Bill of Rights; hence, whatever restrictions are imposed by Congress on
broadcast media franchisees remain susceptible to judicial review and
analysis under the jurisprudential framework for scrutiny of free
expression cases involving the broadcast media.
The restrictions enacted by Congress on broadcast media franchisees
have to pass the mettle of constitutionality. On the other hand, the
restrictions imposed by an administrative agency such as the NTC on
broadcast media franchisees will have to pass not only the test of
constitutionality, but also the test of authority and legitimacy, i.e., whether
such restrictions have been imposed in the exercise of duly delegated
legislative powers from Congress. If the restriction or sanction imposed
by the administrative agency cannot trace its origin from legislative
delegation, whether it is by virtue of a specific grant or from valid
delegation of rule-making power to the administrative agency, then the
action of such administrative agency cannot be sustained. The life and
authority of an administrative agency emanates solely from an Act of
Congress, and its faculties confined within the parameters set by the
legislative branch of government.
We earlier replicated the various functions of the NTC, as established by
E.O. No. 546. One can readily notice that even as the NTC is vested with
the power to issue CPCs to broadcast stations, it is not expressly vested
with the power to cancel such CPCs, or otherwise empowered to prevent
broadcast stations with duly issued franchises and CPCs from operating
radio or television stations.
1avvphi1
In contrast, when the Radio Control Act of 1931 maintained a similar
requirement for radio stations to obtain a license from a government
official (the Secretary of Commerce and Industry), it similarly empowered
the government, through the Secretary of Public Works and
Communications, to suspend or revoke such license, as indicated in
Section 3(m):
Section 3. The Secretary of Public Works and Communications is hereby
empowered, to regulate the construction or manufacture, possession,
control, sale and transfer of radio transmitters or transceivers
(combination transmitter-receiver) and the establishment, use, the
operation of all radio stations and of all form of radio communications and
transmissions within the Philippines. In addition to the above he shall
have the following specific powers and duties:
(m) He may, at his direction bring criminal action against violators of the
radio laws or the regulations and confiscate the radio apparatus in case
of illegal operation; or simply suspend or revoke the offender’s station or
operator licenses or refuse to renew such licenses; or just reprimand and
warn the offenders;48
Section 3(m) begets the question – did the NTC retain the power granted
in 1931 to the Secretary of Public Works and Communications to "x x x
suspend or revoke the offender’s station or operator licenses or refuse to
renew such licenses"? We earlier adverted to the statutory history. The
enactment of the Public Service Act in 1936 did not deprive the Secretary
of regulatory jurisdiction over radio stations, which included the power to
impose fines. In fact, the Public Service Commission was precluded from
exercising such jurisdiction, except with respect to the fixing of rates.
Then, in 1972, the regulatory authority over broadcast media was
transferred to the Board of Communications by virtue of P. D. No. 1,
which adopted, approved, and made as part of the law of the land the
Integrated Reorganization Plan which was prepared by the Commission
on Reorganization.49 Among the cabinet departments affected by the plan
was the Department of Public Works and Communications, which was
now renamed the Department of Public Works, Transportation and
Communication.50 New regulatory boards under the administrative
supervision of the Department were created, including the Board of
Communications.51
The functions of the Board of Communications were enumerated in Part
X, Chapter I, Article III, Sec. 5 of the Integrated Reorganization
Plan.52 What is noticeably missing from these enumerated functions of
the Board of Communications is the power to revoke or cancel CPCs,
even as the Board was vested the power to issue the same. That same
pattern held true in 1976, when the Board of Communications was
abolished by E.O. No. 546.53 Said executive order, promulgated by then
President Marcos in the exercise of his legislative powers, created the
NTC but likewise withheld from it the authority to cancel licenses and
CPCs, even as it was empowered to issue CPCs. Given the very specific
functions allocated by law to the NTC, it would be very difficult to
recognize any intent to allocate to the Commission such regulatory
functions previously granted to the Secretary of Public Works and
Communications, but not included in the exhaustive list of functions
enumerated in Section 15.
Certainly, petitioner fails to point to any provision of E.O. No. 546
authorizing the NTC to cancel licenses. Neither does he cite any
provision under P.D. No. 1 or the Radio Control Act, even if Section 3(m)
of the latter law provides at least, the starting point of a fair argument.
Instead, petitioner relies on the power granted to the Public Service
Commission to revoke CPCs or CPCNs under Section 16(m) of the
Public Service Act.54 That argument has been irrefragably refuted by
Section 14 of the Public Service Act, and by jurisprudence, most
especially RCPI v. NTC.55 As earlier noted, at no time did radio
companies fall under the jurisdiction of the Public Service Commission as
they were expressly excluded from its mandate under Section 14. In
addition, the Court ruled in RCPI that since radio companies, including
broadcast stations and telegraphic agencies, were never under the
jurisdiction of the Public Service Commission except as to rate-fixing, that
Commission’s authority to impose fines did not carry over to the NTC
even while the other regulatory agencies that emanated from the
Commission did retain the previous authority their predecessor had
exercised.56 No provision in the Public Service Act thus can be relied
upon by the petitioner to claim that the NTC has the authority to cancel
CPCs or licenses.
It is still evident that E.O. No. 546 provides no explicit basis to assert that
the NTC has the power to cancel the licenses or CPCs it has duly issued,
even as the government office previously tasked with the regulation of
radio stations, the Secretary of Public Works and Communications,
previously possessed such power by express mandate of law. In order to
sustain petitioner’s premise, the Court will be unable to rely on an
unequivocally current and extant provision of law that justifies the NTC’s
power to cancel CPCs. Petitioner suggests that since the NTC has the
power to issue CPCs, it necessarily has the power to revoke the same.
One might also argue that through the general rule-making power of the
NTC, we can discern a right of the NTC to cancel CPCs.
We must be mindful that the issue for resolution is not a run-of-the-mill
matter which would be settled with ease with the application of the
principles of statutory construction. It is at this juncture that the
constitutional implications of this case must ascend to preeminence.
A.
It is beyond question that respondents, as with all other radio and
television broadcast stations, find shelter in the Bill of Rights, particularly
Section 3, Article III of the Constitution. At the same time, as we have
labored earlier to point out, broadcast media stands, by reason of the
conditions of scarcity, within a different tier of protection from print media,
which unlike broadcast, does not have any regulatory interaction with the
government during its operation.
Still, the fact that state regulation of broadcast media is constitutionally
justified does not mean that its practitioners are precluded from invoking
Section 3, Article III of the Constitution in their behalf. Far from it. Our
democratic way of life is actualized by the existence of a free press,
whether print media or broadcast media. As with print media, free
expression through broadcast media is protected from prior restraint or
subsequent punishment. The franchise and licensing requirements are
mainly impositions of the laws of physics which would stand to periodic
reassessment as technology advances. The science of today renders
state regulation as a necessity, yet this should not encumber the courts
from accommodating greater freedoms to broadcast media when doing
so would not interfere with the existing legitimate state interests in
regulating the industry.
In FCC v. League of Women Voters of California,57 the U.S. Supreme
Court reviewed a law prohibiting noncommercial broadcast stations that
received funding from a public corporation from "engaging in
editorializing." The U.S. Supreme Court acknowledged the differentiated
First Amendment standard of review that applied to broadcast media.
Still, it struck down the restriction, holding that "[the] regulation
impermissibly sweeps within its prohibition a wide range of speech by
wholly private stations on topics that do not take a directly partisan stand
or that have nothing whatever to do with federal, state, or local
government."58 We are similarly able to maintain fidelity to the
fundamental rights of broadcasters even while upholding the rationale
behind the regulatory regime governing them.
Should petitioner’s position that the NTC has the power to cancel CPCs
or licenses it has issued to broadcast stations although they are in the
first place empowered by their respective franchise to exercise their rights
to free expression and as members of a free press, be adopted
broadcast media would be encumbered by another layer of state
restrictions. As things stand, they are already required to secure a
franchise from Congress and a CPC from the NTC in order to operate.
Upon operation, they are obliged to comply with the various regulatory
issuances of the NTC, which has the power to impose fees and fines and
other mandates it may deem fit to prescribe in the exercise of its rule-
making power.
The fact that broadcast media already labors under this concededly valid
regulatory framework necessarily creates inhibitions on its practitioners
as they operate on a daily basis. Newspapers are able to print out their
daily editions without fear that a government agency such as the NTC will
be able to suspend their publication or fine them based on their content.
Broadcast stations do already operate with that possibility in mind, and
that circumstance ineluctably restrains its content, notwithstanding the
constitutional right to free expression. However, the cancellation of a
CPC or license to operate of a broadcast station, if we recognize that
possibility, is essentially a death sentence, the most drastic means to
inhibit a broadcast media practitioner from exercising the constitutional
right to free speech, expression and of the press.
This judicial philosophy aligns well with the preferred mode of scrutiny in
the analysis of cases with dimensions of the right to free expression.
When confronted with laws dealing with freedom of the mind or restricting
the political process, of laws dealing with the regulation of speech,
gender, or race as well as other fundamental rights as expansion from its
earlier applications to equal protection, the Court has deemed it
appropriate to apply "strict scrutiny" when assessing the laws involved or
the legal arguments pursued that would diminish the efficacy of such
constitutional right. The assumed authority of the NTC to cancel CPCs or
licenses, if sustained, will create a permanent atmosphere of a less free
right to express on the part of broadcast media. So that argument could
be sustained, it will have to withstand the strict scrutiny from this Court.
Strict scrutiny entails that the presumed law or policy must be justified by
a compelling state or government interest, that such law or policy must be
narrowly tailored to achieve that goal or interest, and that the law or
policy must be the least restrictive means for achieving that interest. It is
through that lens that we examine petitioner’s premise that the NTC has
the authority to cancel licenses of broadcast franchisees.
B.
In analyzing the compelling government interest that may justify the
investiture of authority on the NTC advocated by petitioner, we cannot
ignore the interest of the State as expressed in the respective legislative
franchises of the petitioner, R.A. No. 7477 and R. A. Act No. 7582. Since
legislative franchises are extended through statutes, they should receive
recognition as the ultimate expression of State policy. What the
legislative franchises of respondents express is that the Congress, after
due debate and deliberation, declares it as State policy that respondents
should have the right to operate broadcast stations. The President of the
Philippines, by affixing his signature to the law, concurs in such State
policy.
Allowing the NTC to countermand State policy by revoking respondent’s
vested legal right to operate broadcast stations unduly gives to a mere
administrative agency veto power over the implementation of the law and
the enforcement of especially vested legal rights. That concern would not
arise if Congress had similarly empowered the NTC with the power to
revoke a franchisee’s right to operate broadcast stations. But as earlier
stated, there is no such expression in the law, and by presuming such
right the Court will be acting contrary to the stated State interest as
expressed in respondents’ legislative franchises.
If we examine the particular franchises of respondents, it is readily
apparent that Congress has especially invested the NTC with certain
powers with respect to their broadcast operations. Both R.A. No.
747759 and R.A. No. 758260 require the grantee "to secure from the [NTC]
the appropriate permits and licenses for its stations," barring the private
respondents from "using any frequency in the radio spectrum without
having been authorized by the [NTC]." At the same time, both laws
provided that "[the NTC], however, shall not unreasonably withhold or
delay the grant of any such authority."
An important proviso is stipulated in the legislative franchises, particularly
under Section 5 of R.A. No. 7477 and Section 3 of R.A. No. 7582, in
relation to Section 11 of R.A. No. 3902.
Section 5. Right of Government. ― A special right is hereby reserved to
the President of the Philippines, in times of rebellion, public peril,
calamity, emergency, disaster or disturbance of peace and order, to
temporarily take over and operate the stations of the grantee, temporarily
suspend the operation of any stations in the interest of public safety,
security and public welfare, or authorize the temporary use and operation
thereof by any agency of the Government, upon due compensation to the
grantee, for the use of said stations during the period when they shall be
so operated.
The provision authorizes the President of the Philippines to exercise
considerable infringements on the right of the franchisees to operate their
enterprises and the right to free expression. Such authority finds corollary
constitutional justification as well under Section 17, Article XII, which
allows the State "in times of national emergency, when the public interest
so requires x x x during the emergency and under reasonable terms
prescribed by it, temporarily take over or direct the operation of any
privately-owned public utility or business affected with public interest."
We do not doubt that the President or the State can exercise such
authority through the NTC, which remains an agency within the executive
branch of government, but such can be exercised only under limited and
rather drastic circumstances. They still do not vest in the NTC the broad
authority to cancel licenses and permits.
These provisions granting special rights to the President in times of
emergency are incorporated in our understanding of the legislated state
policy with respect to the operation by private respondents of their
legislative franchises. There are restrictions to the operation of such
franchises, and when these restrictions are indeed exercised there still
may be cause for the courts to review whether said limitations are
justified despite Section 3, Article I of the Constitution. At the same time,
the state policy as embodied in these franchises is to restrict the
government’s ability to impair the freedom to broadcast of the stations
only upon the occurrence of national emergencies or events that
compromise the national security.
It should be further noted that even the aforequoted provision does not
authorize the President or the government to cancel the licenses of the
respondents. The temporary nature of the takeover or closure of the
station is emphasized in the provision. That fact further disengages the
provision from any sense that such delegated authority can be the source
of a broad ruling affirming the right of the NTC to cancel the licenses of
franchisees.
With the legislated state policy strongly favoring the unimpeded operation
of the franchisee’s stations, it becomes even more difficult to discern
what compelling State interest may be fulfilled in ceding to the NTC the
general power to cancel the franchisee’s CPC’s or licenses absent
explicit statutory authorization. This absence of a compelling state
interest strongly disfavors petitioner’s cause.
C.
Now, we shall tackle jointly whether a law or policy allowing the NTC to
cancel CPCs or licenses is to be narrowly tailored to achieve that
requisite compelling State goal or interest, and whether such a law or
policy is the least restrictive means for achieving that interest. We
addressed earlier the difficulty of envisioning the compelling State
interest in granting the NTC such authority. But let us assume for
argument’s sake, that relieving the injury complained off by petitioner –
the failure of private respondents to open up ownership through the initial
public offering mandated by law – is a compelling enough State interest
to allow the NTC to extend consequences by canceling the licenses or
CPCs of the erring franchisee.
There is in fact a more appropriate, more narrowly-tailored and least
restrictive remedy that is afforded by the law. Such remedy is that
adverted to by the NTC and the Court of Appeals – the resort to quo
warranto proceedings under Rule 66 of the Rules of Court.
Under Section 1 of Rule 66, "an action for the usurpation of a public
office, position or franchise may be brought in the name of the Republic
of the Philippines against a person who usurps, intrudes into, or
unlawfully holds or exercises public office, position or franchise."61 Even
while the action is maintained in the name of the Republic 62 , the Solicitor
General or a public prosecutor is obliged to commence such action upon
complaint, and upon good reason to believe that any case specified
under Section 1 of Rule 66 can be established by proof. 63
The special civil action of quo warranto is a prerogative writ by which the
Government can call upon any person to show by what warrant he holds
a public office or exercises a public franchise.64 It is settled that "[t]he
determination of the right to the exercise of a franchise, or whether the
right to enjoy such privilege has been forfeited by non-user, is more
properly the subject of the prerogative writ of quo warranto, the right to
assert which, as a rule, belongs to the State ‘upon complaint or
otherwise,’ the reason being that the abuse of a franchise is a public
wrong and not a private injury."65 A forfeiture of a franchise will have to be
declared in a direct proceeding for the purpose brought by the State
because a franchise is granted by law and its unlawful exercise is
primarily a concern of Government.66 Quo warranto is specifically
available as a remedy if it is thought that a government corporation has
offended against its corporate charter or misused its franchise. 67
The Court of Appeals correctly noted that in PLDT v. NTC, 68 the Court
had cited quo warranto as the appropriate recourse with respect to an
allegation by petitioner therein that a rival telecommunications competitor
had failed to construct its radio system within the ten (10) years from
approval of its franchise, as mandated by its legislative franchise. 69 It is
beyond dispute that quo warranto exists as an available and appropriate
remedy against the wrong imputed on private respondents.
Petitioners argue that since their prayer involves the cancellation of the
provisional authority and CPCs, and not the legislative franchise, then
quo warranto fails as a remedy. The argument is artificial. The authority
of the franchisee to engage in broadcast operations is derived in the
legislative mandate. To cancel the provisional authority or the CPC is, in
effect, to cancel the franchise or otherwise prevent its exercise. By law,
the NTC is incapacitated to frustrate such mandate by unduly withholding
or canceling the provisional authority or the CPC for reasons other than
the orderly administration of the frequencies in the radio spectrum.
What should occur instead is the converse. If the courts conclude that
private respondents have violated the terms of their franchise and thus
issue the writs of quo warranto against them, then the NTC is obliged to
cancel any existing licenses and CPCs since these permits draw strength
from the possession of a valid franchise. If the point has not already been
made clear, then licenses issued by the NTC such as CPCs and
provisional authorities are junior to the legislative franchise enacted by
Congress. The licensing authority of the NTC is not on equal footing with
the franchising authority of the State through Congress. The issuance of
licenses by the NTC implements the legislative franchises established by
Congress, in the same manner that the executive branch implements the
laws of Congress rather than creates its own laws. And similar to the
inability of the executive branch to prevent the implementation of laws by
Congress, the NTC cannot, without clear and proper delegation by
Congress, prevent the exercise of a legislative franchise by withholding
or canceling the licenses of the franchisee.
And the role of the courts, through quo warranto proceedings, neatly
complements the traditional separation of powers that come to bear in
our analysis. The courts are entrusted with the adjudication of the legal
status of persons, the final arbiter of their rights and obligations under
law. The question of whether a franchisee is in breach of the franchise
specially enacted for it by Congress is one inherently suited to a court of
law, and not for an administrative agency, much less one to which no
such function has been delegated by Congress. In the same way that
availability of judicial review over laws does not preclude Congress from
undertaking its own remedial measures by appropriately amending laws,
the viability of quo warranto in the instant cases does not preclude
Congress from enforcing its own prerogative by abrogating the legislative
franchises of respondents should it be distressed enough by the
franchisees’ violation of the franchises extended to them.
Evidently, the suggested theory of petitioner to address his plaints simply
overpowers the delicate balance of separation of powers, and unduly
grants superlative prerogatives to the NTC to frustrate the exercise of the
constitutional freedom speech, expression, and of the press. A more
narrowly-tailored relief that is responsive to the cause of petitioner not
only exists, but is in fact tailor-fitted to the constitutional framework of our
government and the adjudication of legal and constitutional rights. Given
the current status of the law, there is utterly no reason for this Court to
subscribe to the theory that the NTC has the presumed authority to
cancel licenses and CPCs issued to due holders of legislative franchise
to engage in broadcast operations.
V.
An entire subset of questions may arise following this decision, involving
issues or situations not presently before us. We wish to make clear that
the only aspect of the regulatory jurisdiction of the NTC that we are ruling
upon is its presumed power to cancel provisional authorities, CPCs or
CPCNs and other such licenses required of franchisees before they can
engage in broadcast operations. Moreover, our conclusion that the NTC
has no such power is borne not simply from the statutory language of
E.O. No. 546 or the respective stipulations in private respondents’
franchises, but moreso, from the application of the strict scrutiny standard
which, despite its weight towards free speech, still involves the analysis
of the competing interests of the regulator and the regulated.
In resolving the present questions, it was of marked impact to the Court
that the presumed power to cancel would lead to utterly fatal
consequences to the constitutional right to expression, as well as the
legislated right of these franchisees to broadcast. Other regulatory
measures of less drastic impact will have to be assessed on their own
terms in the proper cases, and our decision today should not be accepted
or cited as a blanket shearing of the NTC’s regulatory jurisdiction. In
addition, considering our own present recognition of legislative authority
to regulate broadcast media on terms more cumbersome than print
media, it should not be discounted that Congress may enact
amendments to the organic law of the NTC that would alter the legal
milieu from which we adjudicated today. 1avvphi1.zw+
Still, the Court sees all benefit and no detriment in striking this blow in
favor of free expression and of the press. While the ability of the State to
broadly regulate broadcast media is ultimately dictated by physics,
regulation with a light touch evokes a democracy mature enough to
withstand competing viewpoints and tastes. Perhaps unwittingly, the
position advocated by petitioner curdles a most vital sector of the press –
broadcast media – within the heavy hand of the State. The argument is
not warranted by law, and it betrays the constitutional expectations on
this Court to assert lines not drawn and connect the dots around throats
that are free to speak.
WHEREFORE, the instant petition is DENIED. No pronouncement as to
costs.
SO ORDERED.
 MAXIMO CALALANG, Petitioner, v. A. D. WILLIAMS, ET
AL., Respondents.
Maximo Calalang in his own behalf.
Solicitor General Ozaeta and Assistant Solicitor General
Amparo for respondents Williams, Fragante and Bayan
City Fiscal Mabanag for the other respondents.
SYLLABUS
1. CONSTITUTIONAL LAW; CONSTITUTIONALITY OF
COMMONWEALTH ACT No. 648; DELEGATION OF LEGISLATIVE
POWER; AUTHORITY OF DIRECTOR OF PUBLIC WORKS AND
SECRETARY OF PUBLIC WORKS AND COMMUNICATIONS TO
PROMULGATE RULES AND REGULATIONS. — The provisions of
section 1 of Commonwealth Act No. 648 do not confer
legislative power upon the Director of Public Works and the
Secretary of Public Works and Communications. The authority
therein conferred upon them and under which they promulgated
the rules and regulations now complained of is not to determine
what public policy demands but merely to carry out the
legislative policy laid down by the National Assembly in said Act,
to wit, "to promote safe transit upon, and avoid obstructions on,
roads and streets designated as national roads by acts of the
National Assembly or by executive orders of the President of the
Philippines" and to close them temporarily to any or all classes
of traffic "whenever the condition of the road or the traffic
thereon makes such action necessary or advisable in the public
convenience and interest." The delegated power, if at all,
therefore, is not the determination of what the law shall be, but
merely the ascertainment of the facts and circumstances upon
which the application of said law is to be predicated. To
promulgate rules and regulations on the use of national roads
and to determine when and how long a national road should be
closed to traffic, in view of the condition of the road or the
traffic thereon and the requirements of public convenience and
interest, is an administrative function which cannot be directly
discharged by the National Assembly. It must depend on the
discretion of some other government official to whom is
confided the duty of determining whether the proper occasion
exists for executing the law. But it cannot be said that the
exercise of such discretion is the making of the law.
2. ID.; ID.; POLICE POWER; PERSONAL LIBERTY;
GOVERNMENTAL AUTHORITY. — Commonwealth Act No. 548
was passed by the National Assembly in the exercise of the
paramount police power of the state. Said Act, by virtue of
which the rules and regulations complained of were
promulgated, aims to promote safe transit upon and avoid
obstructions on national roads, in the interest and convenience
of the public. In enacting said law, therefore, the National
Assembly was prompted by considerations of public
convenience and welfare. It was inspired by a desire to relieve
congestion of traffic, which is, to say the least, a menace to
public safety. Public welfare, then, lies at the bottom of the
enactment of said law, and the state in order to promote the
general welfare may interfere with personal liberty, with
property, and with business and occupations. Persons and
property may be subjected to all kinds of restraints and
burdens, in order to secure the general comfort, health, and
prosperity of the state (U.S. v. Gomer Jesus, 31 Phil., 218). To
this fundamental aim of our Government the rights of the
individual are subordinated. Liberty is a blessing without which
life is a misery, but liberty should not be made to prevail over
authority because then society will fall into anarchy. Neither
should authority be made to prevail over liberty because then
the individual will fall into slavery. The citizen should achieve
the required balance of liberty and authority in his mind through
education and, personal discipline, so that there may be
established the resultant equilibrium, which means peace and
order and happiness for all. The moment greater authority is
conferred upon the government, logically so much is withdrawn
from the residuum of liberty which resides in the people. The
paradox lies in the fact that the apparent curtailment of liberty
is precisely the very means of insuring its preservation.
3. ID.; ID.; SOCIAL JUSTICE. — Social justice is "neither
communism, nor despotism, nor atomism, nor anarchy," but
the humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated.
Social justice means the promotion of the welfare of all the
people, the adoption by the Government of measures calculated
to insure economic stability of all the competent elements of
society, through the maintenance of a proper economic and
social equilibrium in the interrelations of the members of the
community, constitutionally, through the adoption of measures
legally justifiable, or extra-constitutionally, through the exercise
of powers underlying the existence of all governments on the
time-honored principle of salus populi est suprema lex. Social
justice, therefore, must be founded on the recognition of the
necessity of interdependence among divers and diverse units of
a society and of the protection that should be equally and
evenly extended to all groups as a combined force in our social
and economic life, consistent with the fundamental and
paramount objective of the state of promoting the health,
comfort, and quiet of all persons, and of bringing about "the
greatest good to the greatest number."
DECISION
LAUREL, J.:
Maximo Calalang, in his capacity as a private citizen and as a
taxpayer of Manila, brought before this court this petition for a
writ of prohibition against the respondents, A. D. Williams, as
Chairman of the National Traffic Commission; Vicente Fragante,
as Director of Public Works; Sergio Bayan, as Acting Secretary
of Public Works and Communications; Eulogio Rodriguez, as
Mayor of the City of Manila; and Juan Dominguez, as Acting
Chief of Police of Manila.
It is alleged in the petition that the National Traffic Commission,
in its resolution of July 17, 1940, resolved to recommend to the
Director of Public Works and to the Secretary of Public Works
and Communications that animal-drawn vehicles be prohibited
from passing along Rosario Street extending from Plaza
Calderon de la Barca to Dasmariñas Street, from 7:30 a.m. to
12:30 p.m. and from 1:30 p.m. to 5:30 p.m.; and along Rizal
Avenue extending from the railroad crossing at Antipolo Street
to Echague Street, from 7 a.m. to 11 p.m., from a period of one
year from the date of the opening of the Colgante Bridge to
traffic; that the Chairman of the National Traffic Commission, on
July 18, 1940 recommended to the Director of Public Works the
adoption of the measure proposed in the resolution
aforementioned, in pursuance of the provisions of
Commonwealth Act No. 548 which authorizes said Director of
Public Works, with the approval of the Secretary of Public Works
and Communications, to promulgate rules and regulations to
regulate and control the use of and traffic on national roads;
that on August 2, 1940, the Director of Public Works, in his first
indorsement to the Secretary of Public Works and
Communications, recommended to the latter the approval of the
recommendation made by the Chairman of the National Traffic
Commission as aforesaid, with the modification that the closing
of Rizal Avenue to traffic to animal-drawn vehicles be limited to
the portion thereof extending from the railroad crossing at
Antipolo Street to Azcarraga Street; that on August 10, 1940,
the Secretary of Public Works and Communications, in his
second indorsement addressed to the Director of Public Works,
approved the recommendation of the latter that Rosario Street
and Rizal Avenue be closed to traffic of animal-drawn vehicles,
between the points and during the hours as above indicated, for
a period of one year from the date of the opening of the
Colgante Bridge to traffic; that the Mayor of Manila and the
Acting Chief of Police of Manila have enforced and caused to be
enforced the rules and regulations thus adopted; that as a
consequence of such enforcement, all animal-drawn vehicles
are not allowed to pass and pick up passengers in the places
above-mentioned to the detriment not only of their owners but
of the riding public as well.
It is contended by the petitioner that Commonwealth Act No.
548 by which the Director of Public Works, with the approval of
the Secretary of Public Works and Communications, is
authorized to promulgate rules and regulations for the
regulation and control of the use of and traffic on national roads
and streets is unconstitutional because it constitutes an undue
delegation of legislative power. This contention is untenable. As
was observed by this court in Rubi v. Provincial Board of
Mindoro (39 Phil, 660, 700), "The rule has nowhere been better
stated than in the early Ohio case decided by Judge Ranney,
and since followed in a multitude of cases, namely: ’The true
distinction therefore is between the delegation of power to
make the law, which necessarily involves a discretion as to what
it shall be, and conferring an authority or discretion as to its
execution, to be exercised under and in pursuance of the law.
The first cannot be done; to the latter no valid objection can be
made.’ (Cincinnati, W. & Z. R. Co. v. Comm’rs. Clinton County,
1 Ohio St., 88.) Discretion, as held by Chief Justice Marshall in
Wayman v. Southard (10 Wheat., 1) may be committed by the
Legislature to an executive department or official. The
Legislature may make decisions of executive departments or
subordinate officials thereof, to whom it has committed the
execution of certain acts, final on questions of fact. (U.S. v.
Kinkead, 248 Fed., 141.) The growing tendency in the decisions
is to give prominence to the ’necessity’ of the case."
cralaw virtua1aw library
Section 1 of Commonwealth Act No. 548 reads as follows:
"SECTION 1. To promote safe transit upon, and avoid
obstructions on, roads and streets designated as national roads
by acts of the National Assembly or by executive orders of the
President of the Philippines, the Director of Public Works, with
the approval of the Secretary of Public Works and
Communications, shall promulgate the necessary rules and
regulations to regulate and control the use of and traffic on such
roads and streets. Such rules and regulations, with the approval
of the President, may contain provisions controlling or
regulating the construction of buildings or other structures
within a reasonable distance from along the national roads.
Such roads may be temporarily closed to any or all classes of
traffic by the Director of Public Works and his duly authorized
representatives whenever the condition of the road or the traffic
thereon makes such action necessary or advisable in the public
convenience and interest, or for a specified period, with the
approval of the Secretary of Public Works and
Communications." cralaw virtua1aw library
The above provisions of law do not confer legislative power
upon the Director of Public Works and the Secretary of Public
Works and Communications. The authority therein conferred
upon them and under which they promulgated the rules and
regulations now complained of is not to determine what public
policy demands but merely to carry out the legislative policy
laid down by the National Assembly in said Act, to wit, "to
promote safe transit upon and avoid obstructions on, roads and
streets designated as national roads by acts of the National
Assembly or by executive orders of the President of the
Philippines" and to close them temporarily to any or all classes
of traffic "whenever the condition of the road or the traffic
makes such action necessary or advisable in the public
convenience and interest." The delegated power, if at all,
therefore, is not the determination of what the law shall be, but
merely the ascertainment of the facts and circumstances upon
which the application of said law is to be predicated. To
promulgate rules and regulations on the use of national roads
and to determine when and how long a national road should be
closed to traffic, in view of the condition of the road or the
traffic thereon and the requirements of public convenience and
jgc:chanrobles.com.ph interest, is an administrative function which cannot be directly
discharged by the National Assembly. It must depend on the
discretion of some other government official to whom is
confided the duty of determining whether the proper occasion
exists for executing the law. But it cannot be said that the
exercise of such discretion is the making of the law. As was said
in Locke’s Appeal (72 Pa. 491): "To assert that a law is less
than a law, because it is made to depend on a future event or
act, is to rob the Legislature of the power to act wisely for the
public welfare whenever a law is passed relating to a state of
affairs not yet developed, or to things future and impossible to
fully know." The proper distinction the court said was this: "The
Legislature cannot delegate its power to make the law; but it
can make a law to delegate a power to determine some fact or
state of things upon which the law makes, or intends to make,
its own action depend. To deny this would be to stop the wheels
of government. There are many things upon which wise and
useful legislation must depend which cannot be known to the
law-making power, and, must, therefore, be a subject of inquiry
and determination outside of the halls of legislation." (Field v.
Clark, 143 U. S. 649, 694; 36 L. Ed. 294.)
In the case of People v. Rosenthal and Osmeña, G.R. Nos.
46076 and 46077, promulgated June 12, 1939, and in
Pangasinan Transportation v. The Public Service Commission,
G.R. No. 47065, promulgated June 26, 1940, this Court had
occasion to observe that the principle of separation of powers
has been made to adapt itself to the complexities of modern
governments, giving rise to the adoption, within certain limits,
of the principle of "subordinate legislation," not only in the
United States and England but in practically all modern
governments. Accordingly, with the growing complexity of
modern life, the multiplication of the subjects of governmental
regulations, and the increased difficulty of administering the
laws, the rigidity of the theory of separation of governmental
powers has, to a large extent, been relaxed by permitting the
delegation of greater powers by the legislative and vesting a
larger amount of discretion in administrative and executive
officials, not only in the execution of the laws, but also in the
promulgation of certain rules and regulations calculated to
promote public interest.
The petitioner further contends that the rules and regulations
promulgated by the respondents pursuant to the provisions of
Commonwealth Act No. 548 constitute an unlawful interference
with legitimate business or trade and abridge the right to
personal liberty and freedom of locomotion. Commonwealth Act
No. 548 was passed by the National Assembly in the exercise of
the paramount police power of the state.
Said Act, by virtue of which the rules and regulations
complained of were promulgated, aims to promote safe transit
upon and avoid obstructions on national roads, in the interest
and convenience of the public. In enacting said law, therefore,
the National Assembly was prompted by considerations of public
convenience and welfare. It was inspired by a desire to relieve
congestion of traffic. which is, to say the least, a menace to
public safety. Public welfare, then, lies at the bottom of the
enactment of said law, and the state in order to promote the
general welfare may interfere with personal liberty, with
property, and with business and occupations. Persons and
property may be subjected to all kinds of restraints and
burdens, in order to secure the general comfort, health, and
prosperity of the state (U.S. v. Gomez Jesus, 31 Phil., 218). To
this fundamental aim of our Government the rights of the
individual are subordinated. Liberty is a blessing without which
life is a misery, but liberty should not be made to prevail over
authority because then society will fall into anarchy. Neither
should authority be made to prevail over liberty because then
the individual will fall into slavery. The citizen should achieve
the required balance of liberty and authority in his mind through
education and personal discipline, so that there may be
established the resultant equilibrium, which means peace and
order and happiness for all. The moment greater authority is
conferred upon the government, logically so much is withdrawn
from the residuum of liberty which resides in the people. The
paradox lies in the fact that the apparent curtailment of liberty
is precisely the very means of insuring its preservation.
The scope of police power keeps expanding as civilization
advances. As was said in the case of Dobbins v. Los Angeles
(195 U.S. 223, 238; 49 L. ed. 169), "the right to exercise the
police power is a continuing one, and a business lawful today
may in the future, because of the changed situation, the growth
of population or other causes, become a menace to the public
health and welfare, and be required to yield to the public good."
And in People v. Pomar (46 Phil., 440), it was observed that
"advancing civilization is bringing within the police power of the
state today things which were not thought of as being within
such power yesterday. The development of civilization, the
rapidly increasing population, the growth of public opinion, with
an increasing desire on the part of the masses and of the
government to look after and care for the interests of the
individuals of the state, have brought within the police power
many questions for regulation which formerly were not so
considered."cralaw virtua1aw library
The petitioner finally avers that the rules and regulations
complained of infringe upon the constitutional precept regarding
the promotion of social justice to insure the well-being and
economic security of all the people. The promotion of social
justice, however, is to be achieved not through a mistaken
sympathy towards any given group. Social justice is "neither
communism, nor despotism, nor atomism, nor anarchy," but
the humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated.
Social justice means the promotion of the welfare of all the
people, the adoption by the Government of measures calculated
to insure economic stability of all the competent elements of
society, through the maintenance of a proper economic and
social equilibrium in the interrelations of the members of the MAXIMO CALALANG, Petitioner, v. A. D. WILLIAMS, ET
community, constitutionally, through the adoption of measures AL., Respondents.
legally justifiable, or extra-constitutionally, through the exercise
of powers underlying the existence of all governments on the Maximo Calalang in his own behalf.
time-honored principle of salus populi est suprema lex.
Solicitor General Ozaeta and Assistant Solicitor General
Social justice, therefore, must be founded on the recognition of Amparo for respondents Williams, Fragante and Bayan
the necessity of interdependence among divers and diverse
units of a society and of the protection that should be equally City Fiscal Mabanag for the other respondents.
and evenly extended to all groups as a combined force in our
social and economic life, consistent with the fundamental and SYLLABUS
paramount objective of the state of promoting the health,
comfort, and quiet of all persons, and of bringing about "the 1. CONSTITUTIONAL LAW; CONSTITUTIONALITY OF
greatest good to the greatest number." cralaw virtua1aw li brary
COMMONWEALTH ACT No. 648; DELEGATION OF LEGISLATIVE
POWER; AUTHORITY OF DIRECTOR OF PUBLIC WORKS AND
In view of the foregoing, the writ of prohibition prayed for is SECRETARY OF PUBLIC WORKS AND COMMUNICATIONS TO
hereby denied, with costs against the petitioner. So ordered. PROMULGATE RULES AND REGULATIONS. — The provisions of
section 1 of Commonwealth Act No. 648 do not confer
legislative power upon the Director of Public Works and the
Secretary of Public Works and Communications. The authority
therein conferred upon them and under which they promulgated
the rules and regulations now complained of is not to determine
what public policy demands but merely to carry out the
legislative policy laid down by the National Assembly in said Act,
to wit, "to promote safe transit upon, and avoid obstructions on,
roads and streets designated as national roads by acts of the
National Assembly or by executive orders of the President of the
Philippines" and to close them temporarily to any or all classes
of traffic "whenever the condition of the road or the traffic
thereon makes such action necessary or advisable in the public
convenience and interest." The delegated power, if at all,
therefore, is not the determination of what the law shall be, but
merely the ascertainment of the facts and circumstances upon
which the application of said law is to be predicated. To
promulgate rules and regulations on the use of national roads
and to determine when and how long a national road should be
closed to traffic, in view of the condition of the road or the
traffic thereon and the requirements of public convenience and
interest, is an administrative function which cannot be directly
discharged by the National Assembly. It must depend on the
discretion of some other government official to whom is
confided the duty of determining whether the proper occasion
 exists for executing the law. But it cannot be said that the
exercise of such discretion is the making of the law.
2. ID.; ID.; POLICE POWER; PERSONAL LIBERTY;
GOVERNMENTAL AUTHORITY. — Commonwealth Act No. 548
was passed by the National Assembly in the exercise of the
paramount police power of the state. Said Act, by virtue of
which the rules and regulations complained of were
promulgated, aims to promote safe transit upon and avoid
obstructions on national roads, in the interest and convenience
of the public. In enacting said law, therefore, the National
Assembly was prompted by considerations of public
convenience and welfare. It was inspired by a desire to relieve
congestion of traffic, which is, to say the least, a menace to
public safety. Public welfare, then, lies at the bottom of the
enactment of said law, and the state in order to promote the
general welfare may interfere with personal liberty, with
property, and with business and occupations. Persons and
property may be subjected to all kinds of restraints and
burdens, in order to secure the general comfort, health, and
prosperity of the state (U.S. v. Gomer Jesus, 31 Phil., 218). To
this fundamental aim of our Government the rights of the
individual are subordinated. Liberty is a blessing without which
life is a misery, but liberty should not be made to prevail over
authority because then society will fall into anarchy. Neither
should authority be made to prevail over liberty because then
the individual will fall into slavery. The citizen should achieve
the required balance of liberty and authority in his mind through
education and, personal discipline, so that there may be
established the resultant equilibrium, which means peace and
order and happiness for all. The moment greater authority is
conferred upon the government, logically so much is withdrawn
from the residuum of liberty which resides in the people. The
paradox lies in the fact that the apparent curtailment of liberty
is precisely the very means of insuring its preservation.
3. ID.; ID.; SOCIAL JUSTICE. — Social justice is "neither
communism, nor despotism, nor atomism, nor anarchy," but
the humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated.
Social justice means the promotion of the welfare of all the
people, the adoption by the Government of measures calculated
to insure economic stability of all the competent elements of
society, through the maintenance of a proper economic and
social equilibrium in the interrelations of the members of the
community, constitutionally, through the adoption of measures
legally justifiable, or extra-constitutionally, through the exercise
of powers underlying the existence of all governments on the
time-honored principle of salus populi est suprema lex. Social
justice, therefore, must be founded on the recognition of the
necessity of interdependence among divers and diverse units of
a society and of the protection that should be equally and
evenly extended to all groups as a combined force in our social
and economic life, consistent with the fundamental and
paramount objective of the state of promoting the health,
comfort, and quiet of all persons, and of bringing about "the
greatest good to the greatest number."
DECISION
LAUREL, J.:
Maximo Calalang, in his capacity as a private citizen and as a
taxpayer of Manila, brought before this court this petition for a
writ of prohibition against the respondents, A. D. Williams, as
Chairman of the National Traffic Commission; Vicente Fragante,
as Director of Public Works; Sergio Bayan, as Acting Secretary
of Public Works and Communications; Eulogio Rodriguez, as
Mayor of the City of Manila; and Juan Dominguez, as Acting
Chief of Police of Manila.
It is alleged in the petition that the National Traffic Commission,
in its resolution of July 17, 1940, resolved to recommend to the
Director of Public Works and to the Secretary of Public Works
and Communications that animal-drawn vehicles be prohibited
from passing along Rosario Street extending from Plaza
Calderon de la Barca to Dasmariñas Street, from 7:30 a.m. to
12:30 p.m. and from 1:30 p.m. to 5:30 p.m.; and along Rizal
Avenue extending from the railroad crossing at Antipolo Street
to Echague Street, from 7 a.m. to 11 p.m., from a period of one
year from the date of the opening of the Colgante Bridge to
traffic; that the Chairman of the National Traffic Commission, on
July 18, 1940 recommended to the Director of Public Works the
adoption of the measure proposed in the resolution
aforementioned, in pursuance of the provisions of
Commonwealth Act No. 548 which authorizes said Director of
Public Works, with the approval of the Secretary of Public Works
and Communications, to promulgate rules and regulations to
regulate and control the use of and traffic on national roads;
that on August 2, 1940, the Director of Public Works, in his first
indorsement to the Secretary of Public Works and
Communications, recommended to the latter the approval of the
recommendation made by the Chairman of the National Traffic
Commission as aforesaid, with the modification that the closing
of Rizal Avenue to traffic to animal-drawn vehicles be limited to
the portion thereof extending from the railroad crossing at
Antipolo Street to Azcarraga Street; that on August 10, 1940,
the Secretary of Public Works and Communications, in his
second indorsement addressed to the Director of Public Works,
approved the recommendation of the latter that Rosario Street
and Rizal Avenue be closed to traffic of animal-drawn vehicles,
between the points and during the hours as above indicated, for
a period of one year from the date of the opening of the
Colgante Bridge to traffic; that the Mayor of Manila and the
Acting Chief of Police of Manila have enforced and caused to be
enforced the rules and regulations thus adopted; that as a
consequence of such enforcement, all animal-drawn vehicles
are not allowed to pass and pick up passengers in the places
above-mentioned to the detriment not only of their owners but
of the riding public as well.
It is contended by the petitioner that Commonwealth Act No.
548 by which the Director of Public Works, with the approval of
the Secretary of Public Works and Communications, is
authorized to promulgate rules and regulations for the
regulation and control of the use of and traffic on national roads
and streets is unconstitutional because it constitutes an undue
delegation of legislative power. This contention is untenable. As
was observed by this court in Rubi v. Provincial Board of
Mindoro (39 Phil, 660, 700), "The rule has nowhere been better
stated than in the early Ohio case decided by Judge Ranney,
and since followed in a multitude of cases, namely: ’The true
distinction therefore is between the delegation of power to
make the law, which necessarily involves a discretion as to what
it shall be, and conferring an authority or discretion as to its
execution, to be exercised under and in pursuance of the law.
The first cannot be done; to the latter no valid objection can be
made.’ (Cincinnati, W. & Z. R. Co. v. Comm’rs. Clinton County,
1 Ohio St., 88.) Discretion, as held by Chief Justice Marshall in
Wayman v. Southard (10 Wheat., 1) may be committed by the
Legislature to an executive department or official. The
Legislature may make decisions of executive departments or
subordinate officials thereof, to whom it has committed the
execution of certain acts, final on questions of fact. (U.S. v.
Kinkead, 248 Fed., 141.) The growing tendency in the decisions
is to give prominence to the ’necessity’ of the case."
cralaw virtua1aw library
Section 1 of Commonwealth Act No. 548 reads as follows: jgc:chanrobles.com.ph
"SECTION 1. To promote safe transit upon, and avoid
obstructions on, roads and streets designated as national roads
by acts of the National Assembly or by executive orders of the
President of the Philippines, the Director of Public Works, with
the approval of the Secretary of Public Works and
Communications, shall promulgate the necessary rules and
regulations to regulate and control the use of and traffic on such
roads and streets. Such rules and regulations, with the approval
of the President, may contain provisions controlling or
regulating the construction of buildings or other structures
within a reasonable distance from along the national roads.
Such roads may be temporarily closed to any or all classes of
traffic by the Director of Public Works and his duly authorized
representatives whenever the condition of the road or the traffic
thereon makes such action necessary or advisable in the public
convenience and interest, or for a specified period, with the
approval of the Secretary of Public Works and
Communications." cralaw virtua1aw library
The above provisions of law do not confer legislative power
upon the Director of Public Works and the Secretary of Public
Works and Communications. The authority therein conferred
upon them and under which they promulgated the rules and
regulations now complained of is not to determine what public
policy demands but merely to carry out the legislative policy
laid down by the National Assembly in said Act, to wit, "to
promote safe transit upon and avoid obstructions on, roads and
streets designated as national roads by acts of the National
Assembly or by executive orders of the President of the
Philippines" and to close them temporarily to any or all classes
of traffic "whenever the condition of the road or the traffic
makes such action necessary or advisable in the public
convenience and interest." The delegated power, if at all,
therefore, is not the determination of what the law shall be, but
merely the ascertainment of the facts and circumstances upon
which the application of said law is to be predicated. To
promulgate rules and regulations on the use of national roads
and to determine when and how long a national road should be
closed to traffic, in view of the condition of the road or the
traffic thereon and the requirements of public convenience and
interest, is an administrative function which cannot be directly
discharged by the National Assembly. It must depend on the
discretion of some other government official to whom is
confided the duty of determining whether the proper occasion
exists for executing the law. But it cannot be said that the
exercise of such discretion is the making of the law. As was said
in Locke’s Appeal (72 Pa. 491): "To assert that a law is less
than a law, because it is made to depend on a future event or
act, is to rob the Legislature of the power to act wisely for the
public welfare whenever a law is passed relating to a state of
affairs not yet developed, or to things future and impossible to
fully know." The proper distinction the court said was this: "The
Legislature cannot delegate its power to make the law; but it
can make a law to delegate a power to determine some fact or
state of things upon which the law makes, or intends to make,
its own action depend. To deny this would be to stop the wheels
of government. There are many things upon which wise and
useful legislation must depend which cannot be known to the
law-making power, and, must, therefore, be a subject of inquiry
and determination outside of the halls of legislation." (Field v.
Clark, 143 U. S. 649, 694; 36 L. Ed. 294.)
In the case of People v. Rosenthal and Osmeña, G.R. Nos.
46076 and 46077, promulgated June 12, 1939, and in
Pangasinan Transportation v. The Public Service Commission,
G.R. No. 47065, promulgated June 26, 1940, this Court had
occasion to observe that the principle of separation of powers
has been made to adapt itself to the complexities of modern
governments, giving rise to the adoption, within certain limits,
of the principle of "subordinate legislation," not only in the
United States and England but in practically all modern
governments. Accordingly, with the growing complexity of
modern life, the multiplication of the subjects of governmental
regulations, and the increased difficulty of administering the
laws, the rigidity of the theory of separation of governmental
powers has, to a large extent, been relaxed by permitting the
delegation of greater powers by the legislative and vesting a
larger amount of discretion in administrative and executive
officials, not only in the execution of the laws, but also in the
promulgation of certain rules and regulations calculated to
promote public interest.
The petitioner further contends that the rules and regulations
promulgated by the respondents pursuant to the provisions of
Commonwealth Act No. 548 constitute an unlawful interference
with legitimate business or trade and abridge the right to
personal liberty and freedom of locomotion. Commonwealth Act
No. 548 was passed by the National Assembly in the exercise of
the paramount police power of the state.
Said Act, by virtue of which the rules and regulations
complained of were promulgated, aims to promote safe transit
upon and avoid obstructions on national roads, in the interest
and convenience of the public. In enacting said law, therefore,
the National Assembly was prompted by considerations of public
convenience and welfare. It was inspired by a desire to relieve
congestion of traffic. which is, to say the least, a menace to
public safety. Public welfare, then, lies at the bottom of the
enactment of said law, and the state in order to promote the
general welfare may interfere with personal liberty, with
property, and with business and occupations. Persons and
property may be subjected to all kinds of restraints and
burdens, in order to secure the general comfort, health, and
prosperity of the state (U.S. v. Gomez Jesus, 31 Phil., 218). To
this fundamental aim of our Government the rights of the
individual are subordinated. Liberty is a blessing without which
life is a misery, but liberty should not be made to prevail over
authority because then society will fall into anarchy. Neither
should authority be made to prevail over liberty because then
the individual will fall into slavery. The citizen should achieve
the required balance of liberty and authority in his mind through
education and personal discipline, so that there may be
established the resultant equilibrium, which means peace and
order and happiness for all. The moment greater authority is
conferred upon the government, logically so much is withdrawn
from the residuum of liberty which resides in the people. The
paradox lies in the fact that the apparent curtailment of liberty
is precisely the very means of insuring its preservation.
The scope of police power keeps expanding as civilization
advances. As was said in the case of Dobbins v. Los Angeles
(195 U.S. 223, 238; 49 L. ed. 169), "the right to exercise the
police power is a continuing one, and a business lawful today
social equilibrium in the interrelations of the members of the
community, constitutionally, through the adoption of measures
legally justifiable, or extra-constitutionally, through the exercise
of powers underlying the existence of all governments on the
time-honored principle of salus populi est suprema lex.
Social justice, therefore, must be founded on the recognition of
the necessity of interdependence among divers and diverse
units of a society and of the protection that should be equally
and evenly extended to all groups as a combined force in our
social and economic life, consistent with the fundamental and
paramount objective of the state of promoting the health,
comfort, and quiet of all persons, and of bringing about "the
greatest good to the greatest number." cralaw virtua1aw li brary

may in the future, because of the changed situation, the growth

of population or other causes, become a menace to the public In view of the foregoing, the writ of prohibition prayed for is
health and welfare, and be required to yield to the public good." hereby denied, with costs against the petitioner. So ordered.
And in People v. Pomar (46 Phil., 440), it was observed that
"advancing civilization is bringing within the police power of the
state today things which were not thought of as being within
such power yesterday. The development of civilization, the
rapidly increasing population, the growth of public opinion, with
an increasing desire on the part of the masses and of the
government to look after and care for the interests of the
individuals of the state, have brought within the police power
many questions for regulation which formerly were not so
considered."cralaw virtua1aw library

The petitioner finally avers that the rules and regulations

complained of infringe upon the constitutional precept regarding
the promotion of social justice to insure the well-being and
economic security of all the people. The promotion of social
justice, however, is to be achieved not through a mistaken
sympathy towards any given group. Social justice is "neither
communism, nor despotism, nor atomism, nor anarchy," but
the humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated.
Social justice means the promotion of the welfare of all the
people, the adoption by the Government of measures calculated
to insure economic stability of all the competent elements of
society, through the maintenance of a proper economic and
G.R. No. 159796 July 17, 2007
ROMEO P. GEROCHI, KATULONG NG BAYAN (KB) and
ENVIRONMENTALIST CONSUMERS NETWORK, INC.
(ECN), Petitioners,
vs.
DEPARTMENT OF ENERGY (DOE), ENERGY REGULATORY
COMMISSION (ERC), NATIONAL POWER CORPORATION (NPC),
POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT GROUP
(PSALM Corp.), STRATEGIC POWER UTILITIES GROUP (SPUG), and
PANAY ELECTRIC COMPANY INC. (PECO), Respondents.
DECISION
NACHURA, J.:
Petitioners Romeo P. Gerochi, Katulong Ng Bayan (KB), and
Environmentalist Consumers Network, Inc. (ECN) (petitioners), come
before this Court in this original action praying that Section 34 of Republic
Act (RA) 9136, otherwise known as the "Electric Power Industry Reform
Act of 2001" (EPIRA), imposing the Universal Charge, 1 and Rule 18 of
the Rules and Regulations (IRR)2 which seeks to implement the said
imposition, be declared unconstitutional. Petitioners also pray that the
Universal Charge imposed upon the consumers be refunded and that a
preliminary injunction and/or temporary restraining order (TRO) be issued
directing the respondents to refrain from implementing, charging, and
collecting the said charge.3 The assailed provision of law reads:
SECTION 34. Universal Charge. — Within one (1) year from the
effectivity of this Act, a universal charge to be determined, fixed and
approved by the ERC, shall be imposed on all electricity end-users for
the following purposes:
(a) Payment for the stranded debts4 in excess of the amount
assumed by the National Government and stranded contract
costs of NPC5 and as well as qualified stranded contract costs of
distribution utilities resulting from the restructuring of the industry;
(b) Missionary electrification;6
(c) The equalization of the taxes and royalties applied to
indigenous or renewable sources of energy vis-à-vis imported
energy fuels;
(d) An environmental charge equivalent to one-fourth of one
centavo per kilowatt-hour (₱0.0025/kWh), which shall accrue to
an environmental fund to be used solely for watershed
rehabilitation and management. Said fund shall be managed by
NPC under existing arrangements; and
(e) A charge to account for all forms of cross-subsidies for a
period not exceeding three (3) years.
The universal charge shall be a non-bypassable charge which shall be
passed on and collected from all end-users on a monthly basis by the
distribution utilities. Collections by the distribution utilities and the
TRANSCO in any given month shall be remitted to the PSALM Corp. on
or before the fifteenth (15th) of the succeeding month, net of any amount
due to the distribution utility. Any end-user or self-generating entity not
connected to a distribution utility shall remit its corresponding universal
charge directly to the TRANSCO. The PSALM Corp., as administrator of
the fund, shall create a Special Trust Fund which shall be disbursed only
for the purposes specified herein in an open and transparent manner. All
amount collected for the universal charge shall be distributed to the
respective beneficiaries within a reasonable period to be provided by the
ERC.
The Facts
Congress enacted the EPIRA on June 8, 2001; on June 26, 2001, it took
effect.7
On April 5, 2002, respondent National Power Corporation-Strategic
Power Utilities Group8 (NPC-SPUG) filed with respondent Energy
Regulatory Commission (ERC) a petition for the availment from the
Universal Charge of its share for Missionary Electrification, docketed as
ERC Case No. 2002-165.9
On May 7, 2002, NPC filed another petition with ERC, docketed as ERC
Case No. 2002-194, praying that the proposed share from the Universal
Charge for the Environmental charge of ₱0.0025 per kilowatt-hour
(/kWh), or a total of ₱119,488,847.59, be approved for withdrawal from
the Special Trust Fund (STF) managed by respondent Power Sector
Assets and
Liabilities Management Group (PSALM)10 for the rehabilitation and
management of watershed areas.11
On December 20, 2002, the ERC issued an Order12 in ERC Case No.
2002-165 provisionally approving the computed amount of ₱0.0168/kWh
as the share of the NPC-SPUG from the Universal Charge for Missionary
Electrification and authorizing the National Transmission Corporation
(TRANSCO) and Distribution Utilities to collect the same from its end-
users on a monthly basis.
On June 26, 2003, the ERC rendered its Decision13 (for ERC Case No.
2002-165) modifying its Order of December 20, 2002, thus:
WHEREFORE, the foregoing premises considered, the provisional
authority granted to petitioner National Power Corporation-Strategic
Power Utilities Group (NPC-SPUG) in the Order dated December 20,
2002 is hereby modified to the effect that an additional amount of
₱0.0205 per kilowatt-hour should be added to the ₱0.0168 per kilowatt-
hour provisionally authorized by the Commission in the said Order.
Accordingly, a total amount of ₱0.0373 per kilowatt-hour is hereby
APPROVED for withdrawal from the Special Trust Fund managed by
PSALM as its share from the Universal Charge for Missionary
Electrification (UC-ME) effective on the following billing cycles:
(a) June 26-July 25, 2003 for National Transmission Corporation
(TRANSCO); and
(b) July 2003 for Distribution Utilities (Dus).
Relative thereto, TRANSCO and Dus are directed to collect the UC-ME in
the amount of ₱0.0373 per kilowatt-hour and remit the same to PSALM
on or before the 15th day of the succeeding month.
In the meantime, NPC-SPUG is directed to submit, not later than April 30,
2004, a detailed report to include Audited Financial Statements and
physical status (percentage of completion) of the projects using the
prescribed format.1avvphi1
Let copies of this Order be furnished petitioner NPC-SPUG and all
distribution utilities (Dus).
SO ORDERED.
On August 13, 2003, NPC-SPUG filed a Motion for Reconsideration
asking the ERC, among others,14 to set aside the above-mentioned
Decision, which the ERC granted in its Order dated October 7, 2003,
disposing:
WHEREFORE, the foregoing premises considered, the "Motion for
Reconsideration" filed by petitioner National Power Corporation-Small
Power Utilities Group (NPC-SPUG) is hereby GRANTED. Accordingly,
the Decision dated June 26, 2003 is hereby modified accordingly.
Relative thereto, NPC-SPUG is directed to submit a quarterly report on
the following:
1. Projects for CY 2002 undertaken;
2. Location
3. Actual amount utilized to complete the project;
4. Period of completion;
5. Start of Operation; and
6. Explanation of the reallocation of UC-ME funds, if any.
SO ORDERED.15
Meanwhile, on April 2, 2003, ERC decided ERC Case No. 2002-194,
authorizing the NPC to draw up to ₱70,000,000.00 from PSALM for its
2003 Watershed Rehabilitation Budget subject to the availability of funds
for the Environmental Fund component of the Universal Charge. 16
On the basis of the said ERC decisions, respondent Panay Electric
Company, Inc. (PECO) charged petitioner Romeo P. Gerochi and all
other end-users with the Universal Charge as reflected in their respective
electric bills starting from the month of July 2003. 17
Hence, this original action.
Petitioners submit that the assailed provision of law and its IRR which
sought to implement the same are unconstitutional on the following
grounds:
 1) The universal charge provided for under Sec. 34 of the EPIRA
and sought to be implemented under Sec. 2, Rule 18 of the IRR
of the said law is a tax which is to be collected from all electric
end-users and self-generating entities. The power to tax is strictly
a legislative function and as such, the delegation of said power to
any executive or administrative agency like the ERC is
unconstitutional, giving the same unlimited authority. The assailed
provision clearly provides that the Universal Charge is to be
determined, fixed and approved by the ERC, hence leaving to the
latter complete discretionary legislative authority.
2) The ERC is also empowered to approve and determine where
the funds collected should be used.
3) The imposition of the Universal Charge on all end-users is
oppressive and confiscatory and amounts to taxation without
representation as the consumers were not given a chance to be
heard and represented.18
Petitioners contend that the Universal Charge has the characteristics of a
tax and is collected to fund the operations of the NPC. They argue that
the cases19 invoked by the respondents clearly show the regulatory
purpose of the charges imposed therein, which is not so in the case at
bench. In said cases, the respective funds20 were created in order to
balance and stabilize the prices of oil and sugar, and to act as buffer to
counteract the changes and adjustments in prices, peso devaluation, and
other variables which cannot be adequately and timely monitored by the
legislature. Thus, there was a need to delegate powers to administrative
bodies.21 Petitioners posit that the Universal Charge is imposed not for a
similar purpose.
On the other hand, respondent PSALM through the Office of the
Government Corporate Counsel (OGCC) contends that unlike a tax which
is imposed to provide income for public purposes, such as support of the
government, administration of the law, or payment of public expenses,
the assailed Universal Charge is levied for a specific regulatory purpose,
which is to ensure the viability of the country's electric power industry.
Thus, it is exacted by the State in the exercise of its inherent police
power. On this premise, PSALM submits that there is no undue
delegation of legislative power to the ERC since the latter merely
exercises a limited authority or discretion as to the execution and
implementation of the provisions of the EPIRA. 22
Respondents Department of Energy (DOE), ERC, and NPC, through the
Office of the Solicitor General (OSG), share the same view that the
Universal Charge is not a tax because it is levied for a specific regulatory
purpose, which is to ensure the viability of the country's electric power
industry, and is, therefore, an exaction in the exercise of the State's
police power. Respondents further contend that said Universal Charge
does not possess the essential characteristics of a tax, that its imposition
would redound to the benefit of the electric power industry and not to the
public, and that its rate is uniformly levied on electricity end-users, unlike
a tax which is imposed based on the individual taxpayer's ability to pay.
Moreover, respondents deny that there is undue delegation of legislative
power to the ERC since the EPIRA sets forth sufficient determinable
standards which would guide the ERC in the exercise of the powers
granted to it. Lastly, respondents argue that the imposition of the
Universal Charge is not oppressive and confiscatory since it is an
exercise of the police power of the State and it complies with the
requirements of due process.23
On its part, respondent PECO argues that it is duty-bound to collect and
remit the amount pertaining to the Missionary Electrification and
Environmental Fund components of the Universal Charge, pursuant to
Sec. 34 of the EPIRA and the Decisions in ERC Case Nos. 2002-194 and
2002-165. Otherwise, PECO could be held liable under Sec. 4624 of the
EPIRA, which imposes fines and penalties for any violation of its
provisions or its IRR.25
The Issues
The ultimate issues in the case at bar are:
1) Whether or not, the Universal Charge imposed under Sec. 34
of the EPIRA is a tax; and
2) Whether or not there is undue delegation of legislative power
to tax on the part of the ERC.26
Before we discuss the issues, the Court shall first deal with an obvious
procedural lapse.
Petitioners filed before us an original action particularly denominated as a
Complaint assailing the constitutionality of Sec. 34 of the EPIRA
imposing the Universal Charge and Rule 18 of the EPIRA's IRR. No
doubt, petitioners have locus standi. They impugn the constitutionality of
Sec. 34 of the EPIRA because they sustained a direct injury as a result of
the imposition of the Universal Charge as reflected in their electric bills.
However, petitioners violated the doctrine of hierarchy of courts when
they filed this "Complaint" directly with us. Furthermore, the Complaint is
bereft of any allegation of grave abuse of discretion on the part of the
ERC or any of the public respondents, in order for the Court to consider it
as a petition for certiorari or prohibition.
Article VIII, Section 5(1) and (2) of the 1987 Constitution27 categorically
provides that:
SECTION 5. The Supreme Court shall have the following powers:
1. Exercise original jurisdiction over cases affecting
ambassadors, other public ministers and consuls, and
over petitions for certiorari, prohibition, mandamus, quo warranto,
and habeas corpus.
2. Review, revise, reverse, modify, or affirm on appeal or
certiorari, as the law or the rules of court may provide, final
judgments and orders of lower courts in:
(a) All cases in which the constitutionality or validity of any treaty,
international or executive agreement, law, presidential decree,
proclamation, order, instruction, ordinance, or regulation is in question.
But this Court's jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, and habeas corpus, while
concurrent with that of the regional trial courts and the Court of Appeals,
does not give litigants unrestrained freedom of choice of forum from
which to seek such relief.28 It has long been established that this Court
will not entertain direct resort to it unless the redress desired cannot be
obtained in the appropriate courts, or where exceptional and compelling
circumstances justify availment of a remedy within and call for the
exercise of our primary jurisdiction.29 This circumstance alone warrants
the outright dismissal of the present action.
This procedural infirmity notwithstanding, we opt to resolve the
constitutional issue raised herein. We are aware that if the
constitutionality of Sec. 34 of the EPIRA is not resolved now, the issue
will certainly resurface in the near future, resulting in a repeat of this
litigation, and probably involving the same parties. In the public interest
and to avoid unnecessary delay, this Court renders its ruling now.
The instant complaint is bereft of merit.
The First Issue
To resolve the first issue, it is necessary to distinguish the State’s power
of taxation from the police power.
The power to tax is an incident of sovereignty and is unlimited in its
range, acknowledging in its very nature no limits, so that security against
its abuse is to be found only in the responsibility of the legislature which
imposes the tax on the constituency that is to pay it. 30 It is based on the
principle that taxes are the lifeblood of the government, and their prompt
and certain availability is an imperious need. 31 Thus, the theory behind
the exercise of the power to tax emanates from necessity; without taxes,
government cannot fulfill its mandate of promoting the general welfare
and well-being of the people.32
On the other hand, police power is the power of the state to promote
public welfare by restraining and regulating the use of liberty and
property.33 It is the most pervasive, the least limitable, and the most
demanding of the three fundamental powers of the State. The justification
is found in the Latin maxims salus populi est suprema lex (the welfare of
the people is the supreme law) and sic utere tuo ut alienum non
laedas (so use your property as not to injure the property of others). As
an inherent attribute of sovereignty which virtually extends to all public
needs, police power grants a wide panoply of instruments through which
the State, as parens patriae, gives effect to a host of its regulatory
powers.34 We have held that the power to "regulate" means the power to
protect, foster, promote, preserve, and control, with due regard for the
interests, first and foremost, of the public, then of the utility and of its
patrons.35
The conservative and pivotal distinction between these two powers rests
in the purpose for which the charge is made. If generation of revenue is
the primary purpose and regulation is merely incidental, the imposition is
a tax; but if regulation is the primary purpose, the fact that revenue is
incidentally raised does not make the imposition a tax. 36
In exacting the assailed Universal Charge through Sec. 34 of the EPIRA,
the State's police power, particularly its regulatory dimension, is invoked.
Such can be deduced from Sec. 34 which enumerates the purposes for
which the Universal Charge is imposed37 and which can be amply
discerned as regulatory in character. The EPIRA resonates such
regulatory purposes, thus:
SECTION 2. Declaration of Policy. — It is hereby declared the policy of
the State:
(a) To ensure and accelerate the total electrification of the
country;
(b) To ensure the quality, reliability, security and affordability of
the supply of electric power;
(c) To ensure transparent and reasonable prices of electricity in a
regime of free and fair competition and full public accountability to
achieve greater operational and economic efficiency and enhance
the competitiveness of Philippine products in the global market;
(d) To enhance the inflow of private capital and broaden the
ownership base of the power generation, transmission and
distribution sectors;
(e) To ensure fair and non-discriminatory treatment of public and
private sector entities in the process of restructuring the electric
power industry;
(f) To protect the public interest as it is affected by the rates and
services of electric utilities and other providers of electric power;
(g) To assure socially and environmentally compatible energy
sources and infrastructure;
(h) To promote the utilization of indigenous and new and
renewable energy resources in power generation in order to
reduce dependence on imported energy;
(i) To provide for an orderly and transparent privatization of the
assets and liabilities of the National Power Corporation (NPC);
(j) To establish a strong and purely independent regulatory body
and system to ensure consumer protection and enhance the
competitive operation of the electricity market; and
(k) To encourage the efficient use of energy and other modalities
of demand side management.
From the aforementioned purposes, it can be gleaned that the assailed
Universal Charge is not a tax, but an exaction in the exercise of the
State's police power. Public welfare is surely promoted.
Moreover, it is a well-established doctrine that the taxing power may be
used as an implement of police power.38 In Valmonte v. Energy
Regulatory Board, et al.39 and in Gaston v. Republic Planters Bank,40 this
Court held that the Oil Price Stabilization Fund (OPSF) and the Sugar
Stabilization Fund (SSF) were exactions made in the exercise of the
police power. The doctrine was reiterated in Osmeña v. Orbos41 with
respect to the OPSF. Thus, we disagree with petitioners that the instant
case is different from the aforementioned cases. With the Universal
Charge, a Special Trust Fund (STF) is also created under the
administration of PSALM.42 The STF has some notable characteristics
similar to the OPSF and the SSF, viz.:
1) In the implementation of stranded cost recovery, the ERC shall
conduct a review to determine whether there is under-recovery or
over recovery and adjust (true-up) the level of the stranded cost
recovery charge. In case of an over-recovery, the ERC shall
ensure that any excess amount shall be remitted to the STF. A
separate account shall be created for these amounts which shall
be held in trust for any future claims of distribution utilities for
stranded cost recovery. At the end of the stranded cost recovery
period, any remaining amount in this account shall be used to
reduce the electricity rates to the end-users.43
2) With respect to the assailed Universal Charge, if the total
amount collected for the same is greater than the actual
availments against it, the PSALM shall retain the balance within
the STF to pay for periods where a shortfall occurs. 44
3) Upon expiration of the term of PSALM, the administration of
the STF shall be transferred to the DOF or any of the DOF
attached agencies as designated by the DOF Secretary. 45
The OSG is in point when it asseverates:
Evidently, the establishment and maintenance of the Special Trust Fund,
under the last paragraph of Section 34, R.A. No. 9136, is well within the
pervasive and non-waivable power and responsibility of the government
to secure the physical and economic survival and well-being of the
community, that comprehensive sovereign authority we designate as the
police power of the State.46
This feature of the Universal Charge further boosts the position that the
same is an exaction imposed primarily in pursuit of the State's police
objectives. The STF reasonably serves and assures the attainment and
perpetuity of the purposes for which the Universal Charge is imposed,
i.e., to ensure the viability of the country's electric power industry.
The Second Issue
The principle of separation of powers ordains that each of the three
branches of government has exclusive cognizance of and is supreme in
matters falling within its own constitutionally allocated sphere. A logical
corollary to the doctrine of separation of powers is the principle of non-
delegation of powers, as expressed in the Latin maxim potestas delegata
non delegari potest (what has been delegated cannot be delegated). This
is based on the ethical principle that such delegated power constitutes
not only a right but a duty to be performed by the delegate through the
instrumentality of his own judgment and not through the intervening mind
of another. 47
In the face of the increasing complexity of modern life, delegation of
legislative power to various specialized administrative agencies is
allowed as an exception to this principle.48 Given the volume and variety
of interactions in today's society, it is doubtful if the legislature can
promulgate laws that will deal adequately with and respond promptly to
the minutiae of everyday life. Hence, the need to delegate to
administrative bodies - the principal agencies tasked to execute laws in
their specialized fields - the authority to promulgate rules and regulations
to implement a given statute and effectuate its policies. All that is
required for the valid exercise of this power of subordinate legislation is
that the regulation be germane to the objects and purposes of the law
and that the regulation be not in contradiction to, but in conformity with,
the standards prescribed by the law. These requirements are
denominated as the completeness test and the sufficient standard test.
Under the first test, the law must be complete in all its terms and
conditions when it leaves the legislature such that when it reaches the
delegate, the only thing he will have to do is to enforce it. The second test
mandates adequate guidelines or limitations in the law to determine the
boundaries of the delegate's authority and prevent the delegation from
running riot.49
The Court finds that the EPIRA, read and appreciated in its entirety, in
relation to Sec. 34 thereof, is complete in all its essential terms and
conditions, and that it contains sufficient standards.
Although Sec. 34 of the EPIRA merely provides that "within one (1) year
from the effectivity thereof, a Universal Charge to be determined, fixed
and approved by the ERC, shall be imposed on all electricity end-users,"
and therefore, does not state the specific amount to be paid as Universal
Charge, the amount nevertheless is made certain by the legislative
parameters provided in the law itself. For one, Sec. 43(b)(ii) of the EPIRA
provides:
SECTION 43. Functions of the ERC. — The ERC shall promote
competition, encourage market development, ensure customer choice
and penalize abuse of market power in the restructured electricity
industry. In appropriate cases, the ERC is authorized to issue cease and
desist order after due notice and hearing. Towards this end, it shall be
responsible for the following key functions in the restructured industry:
xxxx
(b) Within six (6) months from the effectivity of this Act, promulgate and
enforce, in accordance with law, a National Grid Code and a Distribution
Code which shall include, but not limited to the following:
xxxx
(ii) Financial capability standards for the generating companies, the
TRANSCO, distribution utilities and suppliers: Provided, That in the
formulation of the financial capability standards, the nature and function
of the entity shall be considered: Provided, further, That such standards
are set to ensure that the electric power industry participants meet the
minimum financial standards to protect the public interest. Determine, fix,
and approve, after due notice and public hearings the universal charge,
to be imposed on all electricity end-users pursuant to Section 34 hereof;
Moreover, contrary to the petitioners’ contention, the ERC does not enjoy
a wide latitude of discretion in the determination of the Universal Charge.
Sec. 51(d) and (e) of the EPIRA50 clearly provides:
SECTION 51. Powers. — The PSALM Corp. shall, in the performance of
its functions and for the attainment of its objective, have the following
powers:
xxxx
(d) To calculate the amount of the stranded debts and stranded
contract costs of NPC which shall form the basis for ERC in the
determination of the universal charge;
(e) To liquidate the NPC stranded contract costs, utilizing the
proceeds from sales and other property contributed to it, including
the proceeds from the universal charge.
Thus, the law is complete and passes the first test for valid delegation of
legislative power.
As to the second test, this Court had, in the past, accepted as sufficient
standards the following: "interest of law and order;" 51 "adequate and
efficient instruction;"52 "public interest;"53 "justice and equity;"54 "public
convenience and welfare;"55 "simplicity, economy and
efficiency;"56 "standardization and regulation of medical education;" 57 and
"fair and equitable employment practices."58 Provisions of the EPIRA
such as, among others, "to ensure the total electrification of the country
and the quality, reliability, security and affordability of the supply of
electric power"59 and "watershed rehabilitation and management" 60 meet
the requirements for valid delegation, as they provide the limitations on
the ERC’s power to formulate the IRR. These are sufficient standards.
It may be noted that this is not the first time that the ERC's conferred
powers were challenged. In Freedom from Debt Coalition v. Energy
Regulatory Commission,61 the Court had occasion to say:
In determining the extent of powers possessed by the ERC, the
provisions of the EPIRA must not be read in separate parts. Rather, the
law must be read in its entirety, because a statute is passed as a whole,
and is animated by one general purpose and intent. Its meaning cannot
to be extracted from any single part thereof but from a general
consideration of the statute as a whole. Considering the intent of
Congress in enacting the EPIRA and reading the statute in its entirety, it
is plain to see that the law has expanded the jurisdiction of the regulatory
body, the ERC in this case, to enable the latter to implement the reforms
sought to be accomplished by the EPIRA. When the legislators decided
to broaden the jurisdiction of the ERC, they did not intend to abolish or
reduce the powers already conferred upon ERC's predecessors. To
sustain the view that the ERC possesses only the powers and functions
listed under Section 43 of the EPIRA is to frustrate the objectives of the
law.
In his Concurring and Dissenting Opinion62 in the same case, then
Associate Justice, now Chief Justice, Reynato S. Puno described the
immensity of police power in relation to the delegation of powers to the
ERC and its regulatory functions over electric power as a vital public
utility, to wit:
Over the years, however, the range of police power was no longer limited
to the preservation of public health, safety and morals, which used to be
the primary social interests in earlier times. Police power now requires
the State to "assume an affirmative duty to eliminate the excesses and
injustices that are the concomitants of an unrestrained industrial
economy." Police power is now exerted "to further the public welfare — a
concept as vast as the good of society itself." Hence, "police power is but
another name for the governmental authority to further the welfare of
society that is the basic end of all government." When police power is
delegated to administrative bodies with regulatory functions, its exercise
should be given a wide latitude. Police power takes on an even broader
dimension in developing countries such as ours, where the State must
take a more active role in balancing the many conflicting interests in
society. The Questioned Order was issued by the ERC, acting as an
agent of the State in the exercise of police power. We should have
exceptionally good grounds to curtail its exercise. This approach is more
compelling in the field of rate-regulation of electric power rates. Electric
power generation and distribution is a traditional instrument of economic
growth that affects not only a few but the entire nation. It is an important
factor in encouraging investment and promoting business. The engines of
progress may come to a screeching halt if the delivery of electric power is
impaired. Billions of pesos would be lost as a result of power outages or
unreliable electric power services. The State thru the ERC should be able
to exercise its police power with great flexibility, when the need arises.
This was reiterated in National Association of Electricity Consumers for
Reforms v. Energy Regulatory Commission63 where the Court held that
the ERC, as regulator, should have sufficient power to respond in real Corollarily, the NPC generating plants have to privatized and its
time to changes wrought by multifarious factors affecting public utilities. transmission business spun off and privatized thereafter. 67

From the foregoing disquisitions, we therefore hold that there is no undue
delegation of legislative power to the ERC.
Petitioners failed to pursue in their Memorandum the contention in the
Complaint that the imposition of the Universal Charge on all end-users is
oppressive and confiscatory, and amounts to taxation without
representation. Hence, such contention is deemed waived or abandoned
per Resolution64 of August 3, 2004.65 Moreover, the determination of
whether or not a tax is excessive, oppressive or confiscatory is an issue
which essentially involves questions of fact, and thus, this Court is
precluded from reviewing the same.66
Finally, every law has in its favor the presumption of constitutionality, and
to justify its nullification, there must be a clear and unequivocal breach of
the Constitution and not one that is doubtful, speculative, or
argumentative.68 Indubitably, petitioners failed to overcome this
presumption in favor of the EPIRA. We find no clear violation of the
Constitution which would warrant a pronouncement that Sec. 34 of the
EPIRA and Rule 18 of its IRR are unconstitutional and void.
WHEREFORE, the instant case is hereby DISMISSED for lack of merit.
SO ORDERED.

As a penultimate statement, it may be well to recall what this Court said ANTONIO EDUARDO B. NACHURA
of EPIRA: Associate Justice

One of the landmark pieces of legislation enacted by Congress in recent

years is the EPIRA. It established a new policy, legal structure and
regulatory framework for the electric power industry. The new thrust is to
tap private capital for the expansion and improvement of the industry as
the large government debt and the highly capital-intensive character of
the industry itself have long been acknowledged as the critical constraints
to the program. To attract private investment, largely foreign, the jaded
structure of the industry had to be addressed. While the generation and
transmission sectors were centralized and monopolistic, the distribution
side was fragmented with over 130 utilities, mostly small and
uneconomic. The pervasive flaws have caused a low utilization of
existing generation capacity; extremely high and uncompetitive power
rates; poor quality of service to consumers; dismal to forgettable
performance of the government power sector; high system losses; and
an inability to develop a clear strategy for overcoming these
shortcomings.

Thus, the EPIRA provides a framework for the restructuring of the

industry, including the privatization of the assets of the National Power
Corporation (NPC), the transition to a competitive structure, and the
delineation of the roles of various government agencies and the private
entities. The law ordains the division of the industry into four (4) distinct
sectors, namely: generation, transmission, distribution and supply.
G.R. No. 76633 October 18, 1988
EASTERN SHIPPING LINES, INC., petitioner,
vs.
PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION (POEA),
MINISTER OF LABOR AND EMPLOYMENT, HEARING OFFICER
ABDUL BASAR and KATHLEEN D. SACO, respondents.
Jimenea, Dala & Zaragoza Law Office for petitioner.
The Solicitor General for public respondent.
Dizon Law Office for respondent Kathleen D. Saco.
CRUZ, J.:
The private respondent in this case was awarded the sum of P192,000.00 by the Philippine Overseas
Employment Administration (POEA) for the death of her husband. The decision is challenged by the
petitioner on the principal ground that the POEA had no jurisdiction over the case as the husband was
not an overseas worker.
Vitaliano Saco was Chief Officer of the M/V Eastern Polaris when he was
killed in an accident in Tokyo, Japan, March 15, 1985. His widow sued for
damages under Executive Order No. 797 and Memorandum Circular No.
2 of the POEA. The petitioner, as owner of the vessel, argued that the
complaint was cognizable not by the POEA but by the Social Security
System and should have been filed against the State Insurance Fund.
The POEA nevertheless assumed jurisdiction and after considering the
position papers of the parties ruled in favor of the complainant. The
award consisted of P180,000.00 as death benefits and P12,000.00 for
burial expenses.
The petitioner immediately came to this Court, prompting the Solicitor
General to move for dismissal on the ground of non-exhaustion of
administrative remedies.
Ordinarily, the decisions of the POEA should first be appealed to the
National Labor Relations Commission, on the theory inter alia that the
agency should be given an opportunity to correct the errors, if any, of its
subordinates. This case comes under one of the exceptions, however, as
the questions the petitioner is raising are essentially questions of
law. 1 Moreover, the private respondent himself has not objected to the
petitioner's direct resort to this Court, observing that the usual procedure
would delay the disposition of the case to her prejudice.
The Philippine Overseas Employment Administration was created under
Executive Order No. 797, promulgated on May 1, 1982, to promote and
monitor the overseas employment of Filipinos and to protect their rights. It
replaced the National Seamen Board created earlier under Article 20 of
the Labor Code in 1974. Under Section 4(a) of the said executive order,
the POEA is vested with "original and exclusive jurisdiction over all
cases, including money claims, involving employee-employer relations
arising out of or by virtue of any law or contract involving Filipino contract
workers, including seamen." These cases, according to the 1985 Rules
and Regulations on Overseas Employment issued by the POEA, include
"claims for death, disability and other benefits" arising out of such
employment. 2
The petitioner does not contend that Saco was not its employee or that
the claim of his widow is not compensable. What it does urge is that he
was not an overseas worker but a 'domestic employee and consequently
his widow's claim should have been filed with Social Security System,
subject to appeal to the Employees Compensation Commission.
We see no reason to disturb the factual finding of the POEA that Vitaliano
Saco was an overseas employee of the petitioner at the time he met with
the fatal accident in Japan in 1985.
Under the 1985 Rules and Regulations on Overseas Employment,
overseas employment is defined as "employment of a worker outside the
Philippines, including employment on board vessels plying international
waters, covered by a valid contract. 3 A contract worker is described as
"any person working or who has worked overseas under a valid
employment contract and shall include seamen" 4 or "any person working
overseas or who has been employed by another which may be a local
employer, foreign employer, principal or partner under a valid
employment contract and shall include seamen." 5 These definitions
clearly apply to Vitaliano Saco for it is not disputed that he died while
under a contract of employment with the petitioner and alongside the
petitioner's vessel, the M/V Eastern Polaris, while berthed in a foreign
country. 6
It is worth observing that the petitioner performed at least two acts which
constitute implied or tacit recognition of the nature of Saco's employment
at the time of his death in 1985. The first is its submission of its shipping
articles to the POEA for processing, formalization and approval in the
exercise of its regulatory power over overseas employment under
Executive Order NO. 797. 7 The second is its payment 8 of the
contributions mandated by law and regulations to the Welfare Fund for
Overseas Workers, which was created by P.D. No. 1694 "for the purpose
of providing social and welfare services to Filipino overseas workers."
Significantly, the office administering this fund, in the receipt it prepared
for the private respondent's signature, described the subject of the burial
benefits as "overseas contract worker Vitaliano Saco." 9 While this receipt
is certainly not controlling, it does indicate, in the light of the petitioner's
own previous acts, that the petitioner and the Fund to which it had made
contributions considered Saco to be an overseas employee.
The petitioner argues that the deceased employee should be likened to
the employees of the Philippine Air Lines who, although working abroad
in its international flights, are not considered overseas workers. If this be
so, the petitioner should not have found it necessary to submit its
shipping articles to the POEA for processing, formalization and approval
or to contribute to the Welfare Fund which is available only to overseas
workers. Moreover, the analogy is hardly appropriate as the employees
of the PAL cannot under the definitions given be considered seamen nor
are their appointments coursed through the POEA.
The award of P180,000.00 for death benefits and P12,000.00 for burial
expenses was made by the POEA pursuant to its Memorandum Circular
No. 2, which became effective on February 1, 1984. This circular
prescribed a standard contract to be adopted by both foreign and
domestic shipping companies in the hiring of Filipino seamen for
overseas employment. A similar contract had earlier been required by the
National Seamen Board and had been sustained in a number of cases by
this Court. 10 The petitioner claims that it had never entered into such a
contract with the deceased Saco, but that is hardly a serious argument.
In the first place, it should have done so as required by the circular, which
specifically declared that "all parties to the employment of any Filipino
seamen on board any ocean-going vessel are advised to adopt and use
this employment contract effective 01 February 1984 and to desist from
using any other format of employment contract effective that date." In the
second place, even if it had not done so, the provisions of the said
circular are nevertheless deemed written into the contract with Saco as a
postulate of the police power of the State. 11
But the petitioner questions the validity of Memorandum Circular No. 2
itself as violative of the principle of non-delegation of legislative power. It
contends that no authority had been given the POEA to promulgate the
said regulation; and even with such authorization, the regulation
represents an exercise of legislative discretion which, under the principle,
is not subject to delegation.
The authority to issue the said regulation is clearly provided in Section
4(a) of Executive Order No. 797, reading as follows:
... The governing Board of the Administration (POEA), as
hereunder provided shall promulgate the necessary rules
and regulations to govern the exercise of the adjudicatory
functions of the Administration (POEA).
Similar authorization had been granted the National Seamen Board,
which, as earlier observed, had itself prescribed a standard shipping
contract substantially the same as the format adopted by the POEA.
The second challenge is more serious as it is true that legislative
discretion as to the substantive contents of the law cannot be delegated.
What can be delegated is the discretion to determine how the law may be
enforced, not what the law shall be. The ascertainment of the latter
subject is a prerogative of the legislature. This prerogative cannot be
abdicated or surrendered by the legislature to the delegate. Thus, in Ynot
v. Intermediate Apellate Court 12 which annulled Executive Order No. 626,
this Court held:
We also mark, on top of all this, the questionable manner
of the disposition of the confiscated property as
prescribed in the questioned executive order. It is there
authorized that the seized property shall be distributed to
charitable institutions and other similar institutions as the
Chairman of the National Meat Inspection
Commission may see fit, in the case of carabaos.' (Italics
supplied.) The phrase "may see fit" is an extremely
generous and dangerous condition, if condition it is. It is
laden with perilous opportunities for partiality and abuse,
and even corruption. One searches in vain for the usual
standard and the reasonable guidelines, or better still, the
limitations that the officers must observe when they make
their distribution. There is none. Their options are
apparently boundless. Who shall be the fortunate
beneficiaries of their generosity and by what criteria shall
they be chosen? Only the officers named can supply the
 answer, they and they alone may choose the grantee as
they see fit, and in their own exclusive discretion.
Definitely, there is here a 'roving commission a wide and
sweeping authority that is not canalized within banks that
keep it from overflowing,' in short a clearly profligate and
therefore invalid delegation of legislative powers.
There are two accepted tests to determine whether or not there is a valid
delegation of legislative power, viz, the completeness test and the
sufficient standard test. Under the first test, the law must be complete in
all its terms and conditions when it leaves the legislature such that when
it reaches the delegate the only thing he will have to do is enforce
it. 13 Under the sufficient standard test, there must be adequate guidelines
or stations in the law to map out the boundaries of the delegate's
authority and prevent the delegation from running riot. 14
Both tests are intended to prevent a total transference of legislative
authority to the delegate, who is not allowed to step into the shoes of the
legislature and exercise a power essentially legislative.
The principle of non-delegation of powers is applicable to all the three
major powers of the Government but is especially important in the case of
the legislative power because of the many instances when its delegation
is permitted. The occasions are rare when executive or judicial powers
have to be delegated by the authorities to which they legally certain. In
the case of the legislative power, however, such occasions have become
more and more frequent, if not necessary. This had led to the observation
that the delegation of legislative power has become the rule and its non-
delegation the exception.
The reason is the increasing complexity of the task of government and
the growing inability of the legislature to cope directly with the myriad
problems demanding its attention. The growth of society has ramified its
activities and created peculiar and sophisticated problems that the
legislature cannot be expected reasonably to comprehend. Specialization
even in legislation has become necessary. To many of the problems
attendant upon present-day undertakings, the legislature may not have
the competence to provide the required direct and efficacious, not to say,
specific solutions. These solutions may, however, be expected from its
delegates, who are supposed to be experts in the particular fields
assigned to them.
The reasons given above for the delegation of legislative powers in
general are particularly applicable to administrative bodies. With the
proliferation of specialized activities and their attendant peculiar
problems, the national legislature has found it more and more necessary
to entrust to administrative agencies the authority to issue rules to carry
out the general provisions of the statute. This is called the "power of
subordinate legislation."
With this power, administrative bodies may implement the broad policies
laid down in a statute by "filling in' the details which the Congress may
not have the opportunity or competence to provide. This is effected by
their promulgation of what are known as supplementary regulations, such
as the implementing rules issued by the Department of Labor on the new
Labor Code. These regulations have the force and effect of law.
Memorandum Circular No. 2 is one such administrative regulation. The
model contract prescribed thereby has been applied in a significant
number of the cases without challenge by the employer. The power of the
POEA (and before it the National Seamen Board) in requiring the model
contract is not unlimited as there is a sufficient standard guiding the
delegate in the exercise of the said authority. That standard is
discoverable in the executive order itself which, in creating the Philippine
Overseas Employment Administration, mandated it to protect the rights of
overseas Filipino workers to "fair and equitable employment practices."
Parenthetically, it is recalled that this Court has accepted as sufficient
standards "Public interest" in People v. Rosenthal 15 "justice and equity"
in Antamok Gold Fields v. CIR 16 "public convenience and welfare"
in Calalang v. Williams 17 and "simplicity, economy and efficiency"
in Cervantes v. Auditor General, 18 to mention only a few cases. In the
United States, the "sense and experience of men" was accepted
in Mutual Film Corp. v. Industrial Commission, 19 and "national security"
in Hirabayashi v. United States. 20
It is not denied that the private respondent has been receiving a monthly
death benefit pension of P514.42 since March 1985 and that she was
also paid a P1,000.00 funeral benefit by the Social Security System. In
addition, as already observed, she also received a P5,000.00 burial
gratuity from the Welfare Fund for Overseas Workers. These payments
will not preclude allowance of the private respondent's claim against the
petitioner because it is specifically reserved in the standard contract of
employment for Filipino seamen under Memorandum Circular No. 2,
Series of 1984, that—
 Section C. Compensation and Benefits.—
1. In case of death of the seamen during the term of his
Contract, the employer shall pay his beneficiaries the
amount of:
a. P220,000.00 for master and chief
engineers
b. P180,000.00 for other officers, including
radio operators and master electrician
c. P 130,000.00 for ratings.
2. It is understood and agreed that the benefits mentioned
above shall be separate and distinct from, and will be in
addition to whatever benefits which the seaman is entitled
to under Philippine laws. ...
3. ...
c. If the remains of the seaman is buried in
the Philippines, the owners shall pay the
beneficiaries of the seaman an amount
not exceeding P18,000.00 for burial
expenses.
The underscored portion is merely a reiteration of Memorandum Circular
No. 22, issued by the National Seamen Board on July 12,1976, providing
an follows:
Income Benefits under this Rule Shall be Considered
Additional Benefits.—
All compensation benefits under Title II, Book Four of the
Labor Code of the Philippines (Employees Compensation
and State Insurance Fund) shall be granted, in addition to
whatever benefits, gratuities or allowances that the
seaman or his beneficiaries may be entitled to under the
employment contract approved by the NSB. If applicable,
all benefits under the Social Security Law and the
Philippine Medicare Law shall be enjoyed by the seaman
or his beneficiaries in accordance with such laws.
The above provisions are manifestations of the concern of the State for
the working class, consistently with the social justice policy and the
specific provisions in the Constitution for the protection of the working
class and the promotion of its interest.
One last challenge of the petitioner must be dealt with to close t case. Its
argument that it has been denied due process because the same POEA
that issued Memorandum Circular No. 2 has also sustained and applied it
is an uninformed criticism of administrative law itself. Administrative
agencies are vested with two basic powers, the quasi-legislative and the
quasi-judicial. The first enables them to promulgate implementing rules
and regulations, and the second enables them to interpret and apply
such regulations. Examples abound: the Bureau of Internal Revenue
adjudicates on its own revenue regulations, the Central Bank on its own
circulars, the Securities and Exchange Commission on its own rules, as
so too do the Philippine Patent Office and the Videogram Regulatory
Board and the Civil Aeronautics Administration and the Department of
Natural Resources and so on ad infinitum on their respective
administrative regulations. Such an arrangement has been accepted as a
fact of life of modern governments and cannot be considered violative of
due process as long as the cardinal rights laid down by Justice Laurel in
the landmark case of Ang Tibay v. Court of Industrial Relations 21 are
observed.
Whatever doubts may still remain regarding the rights of the parties in
this case are resolved in favor of the private respondent, in line with the
express mandate of the Labor Code and the principle that those with less
in life should have more in law.
When the conflicting interests of labor and capital are weighed on the
scales of social justice, the heavier influence of the latter must be
counter-balanced by the sympathy and compassion the law must accord
the underprivileged worker. This is only fair if he is to be given the
opportunity and the right to assert and defend his cause not as a
subordinate but as a peer of management, with which he can negotiate
on even plane. Labor is not a mere employee of capital but its active and
equal partner.
WHEREFORE, the petition is DISMISSED, with costs against the
petitioner. The temporary restraining order dated December 10, 1986 is
hereby LIFTED. It is so ordered.
G.R. No. L-23825 December 24, 1965
EMMANUEL PELAEZ, petitioner,
vs.
THE AUDITOR GENERAL, respondent.
Zulueta, Gonzales, Paculdo and Associates for petitioner.
Office of the Solicitor General for respondent.
CONCEPCION, J.:
During the period from September 4 to October 29, 1964 the President of
the Philippines, purporting to act pursuant to Section 68 of the Revised
Administrative Code, issued Executive Orders Nos. 93 to 121, 124 and
126 to 129; creating thirty-three (33) municipalities enumerated in the
margin.1 Soon after the date last mentioned, or on November 10, 1964
petitioner Emmanuel Pelaez, as Vice President of the Philippines and as
taxpayer, instituted the present special civil action, for a writ of prohibition
with preliminary injunction, against the Auditor General, to restrain him,
as well as his representatives and agents, from passing in audit any
expenditure of public funds in implementation of said executive orders
and/or any disbursement by said municipalities.
Petitioner alleges that said executive orders are null and void, upon the
ground that said Section 68 has been impliedly repealed by Republic Act
No. 2370 and constitutes an undue delegation of legislative power.
Respondent maintains the contrary view and avers that the present
action is premature and that not all proper parties — referring to the
officials of the new political subdivisions in question — have been
impleaded. Subsequently, the mayors of several municipalities adversely
affected by the aforementioned executive orders — because the latter
have taken away from the former the barrios composing the new political
subdivisions — intervened in the case. Moreover, Attorneys Enrique M.
Fernando and Emma Quisumbing-Fernando were allowed to and did
appear as amici curiae.
The third paragraph of Section 3 of Republic Act No. 2370, reads:
Barrios shall not be created or their boundaries altered nor their
names changed except under the provisions of this Act or by Act
of Congress.
Pursuant to the first two (2) paragraphs of the same Section 3:
All barrios existing at the time of the passage of this Act shall
come under the provisions hereof.
Upon petition of a majority of the voters in the areas affected, a
new barrio may be created or the name of an existing one may be
changed by the provincial board of the province, upon
recommendation of the council of the municipality or
municipalities in which the proposed barrio is stipulated. The
recommendation of the municipal council shall be embodied in a
resolution approved by at least two-thirds of the entire
membership of the said council: Provided, however, That no new
barrio may be created if its population is less than five hundred
persons.
Hence, since January 1, 1960, when Republic Act No. 2370 became
effective, barrios may "not be created or their boundaries altered nor their
names changed" except by Act of Congress or of the corresponding
provincial board "upon petition of a majority of the voters in the areas
affected" and the "recommendation of the council of the municipality or
municipalities in which the proposed barrio is situated." Petitioner argues,
accordingly: "If the President, under this new law, cannot even create a
barrio, can he create a municipality which is composed of several barrios,
since barrios are units of municipalities?"
Respondent answers in the affirmative, upon the theory that a new
municipality can be created without creating new barrios, such as, by
placing old barrios under the jurisdiction of the new municipality. This
theory overlooks, however, the main import of the petitioner's argument,
which is that the statutory denial of the presidential authority to create a
new barrio implies a negation of the bigger power to create
municipalities, each of which consists of several barrios. The cogency
and force of this argument is too obvious to be denied or even
questioned. Founded upon logic and experience, it cannot be offset
except by a clear manifestation of the intent of Congress to the contrary,
and no such manifestation, subsequent to the passage of Republic Act
No. 2379, has been brought to our attention.
Moreover, section 68 of the Revised Administrative Code, upon which the
disputed executive orders are based, provides:
The (Governor-General) President of the Philippines may by
executive order define the boundary, or boundaries, of any
province, subprovince, municipality, [township] municipal district,
 or other political subdivision, and increase or diminish the territory
comprised therein, may divide any province into one or more
subprovinces, separate any political division other than a
province, into such portions as may be required, merge any of
such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government
within any subdivision to such place therein as the public welfare
may require: Provided, That the authorization of the (Philippine
Legislature) Congress of the Philippines shall first be obtained
whenever the boundary of any province or subprovince is to be
defined or any province is to be divided into one or more
subprovinces. When action by the (Governor-General) President
of the Philippines in accordance herewith makes necessary a
change of the territory under the jurisdiction of any administrative
officer or any judicial officer, the (Governor-General) President of
the Philippines, with the recommendation and advice of the head
of the Department having executive control of such officer, shall
redistrict the territory of the several officers affected and assign
such officers to the new districts so formed.
Upon the changing of the limits of political divisions in pursuance
of the foregoing authority, an equitable distribution of the funds
and obligations of the divisions thereby affected shall be made in
such manner as may be recommended by the (Insular Auditor)
Auditor General and approved by the (Governor-General)
President of the Philippines.
Respondent alleges that the power of the President to create
municipalities under this section does not amount to an undue delegation
of legislative power, relying upon Municipality of Cardona vs. Municipality
of Binañgonan (36 Phil. 547), which, he claims, has settled it. Such claim
is untenable, for said case involved, not the creation of a new
municipality, but a mere transfer of territory — from an already
existing municipality (Cardona) to another municipality
(Binañgonan), likewise, existing at the time of and prior to said
transfer (See Gov't of the P.I. ex rel. Municipality of Cardona vs.
Municipality, of Binañgonan [34 Phil. 518, 519-5201) — in consequence
of the fixing and definition, pursuant to Act No. 1748, of the common
boundaries of two municipalities.
It is obvious, however, that, whereas the power to fix such common
boundary, in order to avoid or settle conflicts of jurisdiction between
adjoining municipalities, may partake of an administrative nature —
involving, as it does, the adoption of means and ways to carry into
effect the law creating said municipalities — the authority to create
municipal corporations is essentially legislative in nature. In the language
of other courts, it is "strictly a legislative function" (State ex rel. Higgins
vs. Aicklen, 119 S. 425, January 2, 1959) or "solely and exclusively the
exercise of legislative power" (Udall vs. Severn, May 29, 1938, 79 P. 2d
347-349). As the Supreme Court of Washington has put it (Territory ex
rel. Kelly vs. Stewart, February 13, 1890, 23 Pac. 405, 409), "municipal
corporations are purely the creatures of statutes."
Although1a Congress may delegate to another branch of the Government
the power to fill in the details in the execution, enforcement or
administration of a law, it is essential, to forestall a violation of the
principle of separation of powers, that said law: (a) be complete in itself
— it must set forth therein the policy to be executed, carried out or
implemented by the delegate2 — and (b) fix a standard — the limits of
which are sufficiently determinate or determinable — to which the
delegate must conform in the performance of his functions. 2a Indeed,
without a statutory declaration of policy, the delegate would in effect,
make or formulate such policy, which is the essence of every law; and,
without the aforementioned standard, there would be no means to
determine, with reasonable certainty, whether the delegate has acted
within or beyond the scope of his authority.2b Hence, he could thereby
arrogate upon himself the power, not only to make the law, but, also —
and this is worse — to unmake it, by adopting measures inconsistent with
the end sought to be attained by the Act of Congress, thus nullifying the
principle of separation of powers and the system of checks and balances,
and, consequently, undermining the very foundation of our Republican
system.
Section 68 of the Revised Administrative Code does not meet these well
settled requirements for a valid delegation of the power to fix the details
in the enforcement of a law. It does not enunciate any policy to be carried
out or implemented by the President. Neither does it give a standard
sufficiently precise to avoid the evil effects above referred to. In this
connection, we do not overlook the fact that, under the last clause of the
first sentence of Section 68, the President:
... may change the seat of the government within any
subdivision to such place therein as the public welfare may
require.
It is apparent, however, from the language of this clause, that the phrase
"as the public welfare may require" qualified, not the clauses preceding
the one just quoted, but only the place to which the seat of the
government may be transferred. This fact becomes more apparent when
we consider that said Section 68 was originally Section 1 of Act No.
1748,3 which provided that, "whenever in the judgment of the Governor-
General the public welfare requires, he may, by executive order," effect
the changes enumerated therein (as in said section 68), including the
change of the seat of the government "to such place ... as the public
interest requires." The opening statement of said Section 1 of Act No.
1748 — which was not included in Section 68 of the Revised
Administrative Code — governed the time at which, or the conditions
under which, the powers therein conferred could be exercised; whereas
the last part of the first sentence of said section referred exclusively to
the place to which the seat of the government was to be transferred.
At any rate, the conclusion would be the same, insofar as the case at bar
is concerned, even if we assumed that the phrase "as the public welfare
may require," in said Section 68, qualifies all other clauses thereof. It is
true that in Calalang vs. Williams (70 Phil. 726) and People vs.
Rosenthal (68 Phil. 328), this Court had upheld "public welfare" and
"public interest," respectively, as sufficient standards for a valid
delegation of the authority to execute the law. But, the doctrine laid down
in these cases — as all judicial pronouncements — must be construed in
relation to the specific facts and issues involved therein, outside of which
they do not constitute precedents and have no binding effect. 4 The law
construed in the Calalang case conferred upon the Director of Public
Works, with the approval of the Secretary of Public Works and
Communications, the power to issue rules and regulations to promote
safe transit upon national roads and streets. Upon the other hand, the
Rosenthal case referred to the authority of the Insular Treasurer, under
Act No. 2581, to issue and cancel certificates or permits for the
sale of speculative securities. Both cases involved grants
to administrative officers of powers related to the exercise of their
administrative functions, calling for the determination of questions of fact.
Such is not the nature of the powers dealt with in section 68. As above
indicated, the creation of municipalities, is not an administrative function,
but one which is essentially and eminently legislative in character. The
question of whether or not "public interest" demands the exercise of such
power is not one of fact. it is "purely a legislative question "(Carolina-
Virginia Coastal Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310-
313, 315-318), or a political question (Udall vs. Severn, 79 P. 2d. 347-
349). As the Supreme Court of Wisconsin has aptly characterized it, "the
question as to whether incorporation is for the best interest of the
community in any case is emphatically a question of public policy and
statecraft" (In re Village of North Milwaukee, 67 N.W. 1033, 1035-1037).
For this reason, courts of justice have annulled, as constituting undue
delegation of legislative powers, state laws granting the judicial
department, the power to determine whether certain territories should be
annexed to a particular municipality (Udall vs. Severn, supra, 258-359);
or vesting in a Commission the right to determine the plan and frame of
government of proposed villages and what functions shall be exercised
by the same, although the powers and functions of the village are
specifically limited by statute (In re Municipal Charters, 86 Atl. 307-308);
or conferring upon courts the authority to declare a given town or village
incorporated, and designate its metes and bounds, upon petition of a
majority of the taxable inhabitants thereof, setting forth the area desired
to be included in such village (Territory ex rel Kelly vs. Stewart, 23 Pac.
405-409); or authorizing the territory of a town, containing a given area
and population, to be incorporated as a town, on certain steps being
taken by the inhabitants thereof and on certain determination by a court
and subsequent vote of the inhabitants in favor thereof, insofar as the
court is allowed to determine whether the lands embraced in the petition
"ought justly" to be included in the village, and whether the interest of the
inhabitants will be promoted by such incorporation, and to enlarge and
diminish the boundaries of the proposed village "as justice may require"
(In re Villages of North Milwaukee, 67 N.W. 1035-1037); or creating a
Municipal Board of Control which shall determine whether or not the
laying out, construction or operation of a toll road is in the "public interest"
and whether the requirements of the law had been complied with, in
which case the board shall enter an order creating a municipal
corporation and fixing the name of the same (Carolina-Virginia Coastal
Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310).
Insofar as the validity of a delegation of power by Congress to the
President is concerned, the case of Schechter Poultry Corporation vs.
U.S. (79 L. Ed. 1570) is quite relevant to the one at bar. The Schechter
case involved the constitutionality of Section 3 of the National Industrial
Recovery Act authorizing the President of the United States to approve
"codes of fair competition" submitted to him by one or more trade or
industrial associations or corporations which "impose no inequitable
restrictions on admission to membership therein and are truly
representative," provided that such codes are not designed "to promote
monopolies or to eliminate or oppress small enterprises and will not
operate to discriminate against them, and will tend to effectuate the
policy" of said Act. The Federal Supreme Court held:
To summarize and conclude upon this point: Sec. 3 of the
Recovery Act is without precedent. It supplies no standards for
any trade, industry or activity. It does not undertake to prescribe
 rules of conduct to be applied to particular states of fact
determined by appropriate administrative procedure. Instead of
prescribing rules of conduct, it authorizes the making of codes to
prescribe them. For that legislative undertaking, Sec. 3 sets up no
standards, aside from the statement of the general aims of
rehabilitation, correction and expansion described in Sec. 1. In
view of the scope of that broad declaration, and of the nature of
the few restrictions that are imposed, the discretion of the
President in approving or prescribing codes, and thus enacting
laws for the government of trade and industry throughout the
country, is virtually unfettered. We think that the code making
authority thus conferred is an unconstitutional delegation of
legislative power.
If the term "unfair competition" is so broad as to vest in the President a
discretion that is "virtually unfettered." and, consequently, tantamount to a
delegation of legislative power, it is obvious that "public welfare," which
has even a broader connotation, leads to the same result. In fact, if the
validity of the delegation of powers made in Section 68 were upheld,
there would no longer be any legal impediment to a statutory grant of
authority to the President to do anything which, in his opinion, may be
required by public welfare or public interest. Such grant of authority would
be a virtual abdication of the powers of Congress in favor of the
Executive, and would bring about a total collapse of the democratic
system established by our Constitution, which it is the special duty and
privilege of this Court to uphold.
It may not be amiss to note that the executive orders in question were
issued after the legislative bills for the creation of the municipalities
involved in this case had failed to pass Congress. A better proof of the
fact that the issuance of said executive orders entails the exercise of
purely legislative functions can hardly be given.
Again, Section 10 (1) of Article VII of our fundamental law ordains:
The President shall have control of all the executive departments,
bureaus, or offices, exercise general supervision over all local
governments as may be provided by law, and take care that the
laws be faithfully executed.
The power of control under this provision implies the right of the
President to interfere in the exercise of such discretion as may be vested
by law in the officers of the executive departments, bureaus, or offices of
the national government, as well as to act in lieu of such officers. This
power is denied by the Constitution to the Executive, insofar as local
governments are concerned. With respect to the latter, the fundamental
law permits him to wield no more authority than that of checking whether
said local governments or the officers thereof perform their duties as
provided by statutory enactments. Hence, the President cannot interfere
with local governments, so long as the same or its officers act Within the
scope of their authority. He may not enact an ordinance which the
municipal council has failed or refused to pass, even if it had thereby
violated a duty imposed thereto by law, although he may see to it that the
corresponding provincial officials take appropriate disciplinary action
therefor. Neither may he vote, set aside or annul an ordinance passed by
said council within the scope of its jurisdiction, no matter how patently
unwise it may be. He may not even suspend an elective official of a
regular municipality or take any disciplinary action against him, except on
appeal from a decision of the corresponding provincial board. 5
Upon the other hand if the President could create a municipality, he
could, in effect, remove any of its officials, by creating a new municipality
and including therein the barrio in which the official concerned resides,
for his office would thereby become vacant. 6 Thus, by merely brandishing
the power to create a new municipality (if he had it), without actually
creating it, he could compel local officials to submit to his dictation,
thereby, in effect, exercising over them the power of control denied to him
by the Constitution.
Then, also, the power of control of the President over executive
departments, bureaus or offices implies no more than the authority to
assume directly the functions thereof or to interfere in the exercise of
discretion by its officials. Manifestly, such control does not include the
authority either to abolish an executive department or bureau, or to
create a new one. As a consequence, the alleged power of the President
to create municipal corporations would necessarily connote the exercise
by him of an authority even greater than that of control which he has over
the executive departments, bureaus or offices. In other words, Section 68
of the Revised Administrative Code does not merely fail to comply with
the constitutional mandate above quoted. Instead of giving the President
less power over local governments than that vested in him over the
executive departments, bureaus or offices, it reverses the process and
does the exact opposite, by conferring upon him more power over
municipal corporations than that which he has over said executive
departments, bureaus or offices.
In short, even if it did entail an undue delegation of legislative powers, as
it certainly does, said Section 68, as part of the Revised Administrative
Code, approved on March 10, 1917, must be deemed repealed by the
subsequent adoption of the Constitution, in 1935, which is utterly
incompatible and inconsistent with said statutory enactment. 7
There are only two (2) other points left for consideration, namely,
respondent's claim (a) that "not all the proper parties" — referring to the
officers of the newly created municipalities — "have been impleaded in
this case," and (b) that "the present petition is premature."
As regards the first point, suffice it to say that the records do not show,
and the parties do not claim, that the officers of any of said municipalities
have been appointed or elected and assumed office. At any rate, the
Solicitor General, who has appeared on behalf of respondent Auditor
General, is the officer authorized by law "to act and represent the
Government of the Philippines, its offices and agents, in any official
investigation, proceeding or matter requiring the services of a lawyer"
(Section 1661, Revised Administrative Code), and, in connection with the
creation of the aforementioned municipalities, which involves a political,
not proprietary, function, said local officials, if any, are mere agents or
representatives of the national government. Their interest in the case at
bar has, accordingly, been, in effect, duly represented. 8
With respect to the second point, respondent alleges that he has not as
yet acted on any of the executive order & in question and has not
intimated how he would act in connection therewith. It is, however, a
matter of common, public knowledge, subject to judicial cognizance, that
the President has, for many years, issued executive orders creating
municipal corporations and that the same have been organized and in
actual operation, thus indicating, without peradventure of doubt, that the
expenditures incidental thereto have been sanctioned, approved or
passed in audit by the General Auditing Office and its officials. There is
no reason to believe, therefore, that respondent would adopt a different
policy as regards the new municipalities involved in this case, in the
absence of an allegation to such effect, and none has been made by him.
WHEREFORE, the Executive Orders in question are hereby declared null
and void ab initio and the respondent permanently restrained from
passing in audit any expenditure of public funds in implementation of said
Executive Orders or any disbursement by the municipalities above
referred to. It is so ordered.
Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera and Dizon,
JJ., concur.
Zaldivar, J., took no part.
Separate Opinions
BENGZON, J.P., J., concurring and dissenting:
A sign of progress in a developing nation is the rise of new municipalities.
Fostering their rapid growth has long been the aim pursued by all three
branches of our Government.
So it was that the Governor-General during the time of the Jones Law
was given authority by the Legislature (Act No. 1748) to act upon certain
details with respect to said local governments, such as fixing of
boundaries, subdivisions and mergers. And the Supreme Court, within
the framework of the Jones Law, ruled in 1917 that the execution or
implementation of such details, did not entail abdication of legislative
power (Government vs. Municipality of Binañgonan, 34 Phil. 518;
Municipality of Cardona vs. Municipality of Binañgonan, 36 Phil. 547).
Subsequently, Act No. 1748's aforesaid statutory authorization was
embodied in Section 68 of the Revised Administrative Code. And Chief
Executives since then up to the present continued to avail of said
provision, time and again invoking it to issue executive orders providing
for the creation of municipalities.
From September 4, 1964 to October 29, 1964 the President of the
Philippines issued executive orders to create thirty-three municipalities
pursuant to Section 68 of the Revised Administrative Code. Public funds
thereby stood to be disbursed in implementation of said executive orders.
Suing as private citizen and taxpayer, Vice President Emmanuel Pelaez
filed in this Court a petition for prohibition with preliminary injunction
against the Auditor General. It seeks to restrain the respondent or any
person acting in his behalf, from passing in audit any expenditure of
public funds in implementation of the executive orders aforementioned.
Petitioner contends that the President has no power to create a
municipality by executive order. It is argued that Section 68 of the
Revised Administrative Code of 1917, so far as it purports to grant any
such power, is invalid or, at the least, already repealed, in light of the
Philippine Constitution and Republic Act 2370 (The Barrio Charter).
Section 68 is again reproduced hereunder for convenience:
SEC. 68. General authority of [Governor-General) President of
the Philippines to fix boundaries and make new subdivisions. —
The [Governor-General] President of the Philippines may by
executive order define the boundary, or boundaries, of any
province, subprovince, municipality, [township] municipal district,
or other political subdivision, and increase or diminish the territory
comprised therein, may divide any province into one or more
subprovinces, separate any political division other than a
province, into such portions as may be required, merge any of
such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government
within any subdivision to such place therein as the public welfare
may require: Provided, That the authorization of the [Philippine
Legislature] Congress of the Philippines shall first be obtained
whenever the boundary of any province or subprovince is to be
defined or any province is to be divided into one or more
subprovinces. When action by the [Governor-General] President
of the Philippines in accordance herewith makes necessary a
change of the territory under the jurisdiction of any administrative
officer or any judicial officer, the [Governor-General] President of
the Philippines, with the recommendation and advice of the head
of the Department having executive control of such officer, shall
redistrict the territory of the several officers to the new districts so
formed.
Upon the changing of the limits of political divisions in pursuance
of the foregoing authority, an equitable distribution of the funds
and obligations of the divisions thereby affected shall be made in
such manner as may be recommended by the [Insular Auditor]
Auditor General and approved by the [Governor-General]
President of the Philippines.
From such working I believe that power to create a municipality is
included: to "separate any political division other than a province, into
such portions as may be required, merge any such subdivisions or
portions with another, name any new subdivision so created." The issue,
however, is whether the legislature can validly delegate to the Executive
such power.
The power to create a municipality is legislative in character. American
authorities have therefore favored the view that it cannot be delegated;
that what is delegable is not the power to create municipalities but only
the power to determine the existence of facts under which creation of a
municipality will result (37 Am. Jur. 628).
The test is said to lie in whether the statute allows any discretion on the
delegate as to whether the municipal corporation should be created. If so,
there is an attempted delegation of legislative power and the statute is
invalid (Ibid.). Now Section 68 no doubt gives the President such
discretion, since it says that the President "may by executive order"
exercise the powers therein granted. Furthermore, Section 5 of the same
Code states:
SEC. 5. Exercise of administrative discretion — The exercise of
the permissive powers of all executive or administrative officers
and bodies is based upon discretion, and when such officer or
body is given authority to do any act but not required to do such
act, the doing of the same shall be dependent on a sound
discretion to be exercised for the good of the service and benefit
of the public, whether so expressed in the statute giving the
authority or not.
Under the prevailing rule in the United States — and Section 68 is of
American origin — the provision in question would be an invalid attempt
to delegate purely legislative powers, contrary to the principle of
separation of powers.
It is very pertinent that Section 68 should be considered with the stream
of history in mind. A proper knowledge of the past is the only adequate
background for the present. Section 68 was adopted half a century ago.
Political change, two world wars, the recognition of our independence
and rightful place in the family of nations, have since taken place. In 1917
the Philippines had for its Organic Act the Jones Law. And under the
setup ordained therein no strict separation of powers was adhered to.
Consequently, Section 68 was not constitutionally objectionable at the
time of its enactment.
The advent of the Philippine Constitution in 1935 however altered the
situation. For not only was separation of powers strictly ordained, except
only in specific instances therein provided, but the power of the Chief
Executive over local governments suffered an explicit reduction.
Formerly, Section 21 of the Jones Law provided that the Governor-
General "shall have general supervision and control of all the
departments and bureaus of the government in the Philippine Islands."
Now Section 10 (1), Article VII of the Philippine Constitution provides:
"The President shall have control of all the executive departments,
bureaus, or offices, exercise general supervision over all local
governments as may be provided by law, and take care that the laws be
faithfully executed.
In short, the power of control over local governments had now been
taken away from the Chief Executive. Again, to fully understand the
significance of this provision, one must trace its development and growth.
As early as April 7, 1900 President McKinley of the United States, in his
Instructions to the Second Philippine Commission, laid down the policy
that our municipal governments should be "subject to the least degree of
supervision and control" on the part of the national government. Said
supervision and control was to be confined within the "narrowest limits" or
so much only as "may be necessary to secure and enforce faithful and
efficient administration by local officers." And the national government
"shall have no direct administration except of matters of purely general
concern." (See Hebron v. Reyes, L-9158, July 28, 1958.)
All this had one aim, to enable the Filipinos to acquire experience in the
art of self-government, with the end in view of later allowing them to
assume complete management and control of the administration of their
local affairs. Such aim is the policy now embodied in Section 10 (1),
Article VII of the Constitution (Rodriguez v. Montinola, 50 O.G. 4820).
It is the evident decree of the Constitution, therefore, that the President
shall have no power of control over local governments. Accordingly,
Congress cannot by law grant him such power (Hebron v. Reyes, supra).
And any such power formerly granted under the Jones Law thereby
became unavoidably inconsistent with the Philippine Constitution.
It remains to examine the relation of the power to create and the power to
control local governments. Said relationship has already been passed
upon by this Court in Hebron v. Reyes, supra. In said case, it was ruled
that the power to control is an incident of the power to create or abolish
municipalities. Respondent's view, therefore, that creating municipalities
and controlling their local governments are "two worlds apart," is
untenable. And since as stated, the power to control local governments
can no longer be conferred on or exercised by the President, it follows
a fortiori that the power to create them, all the more cannot be so
conferred or exercised.
I am compelled to conclude, therefore, that Section 10 (1), Article VII of
the Constitution has repealed Section 68 of the Revised Administrative
Code as far as the latter empowers the President to create local
governments. Repeal by the Constitution of prior statutes inconsistent
with it has already been sustained in De los Santos v. MaIlare, 87 Phil.
289. And it was there held that such repeal differs from a declaration of
unconstitutionality of a posterior legislation, so much so that only a
majority vote of the Court is needed to sustain a finding of repeal.
Since the Constitution repealed Section 68 as far back as 1935, it is
academic to ask whether Republic Act 2370 likewise has provisions in
conflict with Section 68 so as to repeal it. Suffice it to state, at any rate,
that statutory prohibition on the President from creating a barrio does not,
in my opinion, warrant the inference of statutory prohibition for creating a
municipality. For although municipalities consist of barrios, there is
nothing in the statute that would preclude creation of new municipalities
out of pre-existing barrios.
It is not contrary to the logic of local autonomy to be able to create larger
political units and unable to create smaller ones. For as long ago
observed in President McKinley's Instructions to the Second Philippine
Commission, greater autonomy is to be imparted to the smaller of the two
political units. The smaller the unit of local government, the lesser is the
need for the national government's intervention in its political affairs.
Furthermore, for practical reasons, local autonomy cannot be given from
the top downwards. The national government, in such a case, could still
exercise power over the supposedly autonomous unit, e.g.,
municipalities, by exercising it over the smaller units that comprise them,
e.g., the barrios. A realistic program of decentralization therefore calls for
autonomy from the bottom upwards, so that it is not surprising for
Congress to deny the national government some power over barrios
without denying it over municipalities. For this reason, I disagree with the
majority view that because the President could not create a barrio under
Republic Act 2370, a fortiori he cannot create a municipality.
It is my view, therefore, that the Constitution, and not Republic Act 2370,
repealed Section 68 of the Revised Administrative Code's provision
giving the President authority to create local governments. And for this
reason I agree with the ruling in the majority opinion that the executive
orders in question are null and void.
In thus ruling, the Court is but sustaining the fulfillment of our historic
desire to be free and independent under a republican form of
government, and exercising a function derived from the very sovereignty
that it upholds. Executive orders declared null and void.
G.R. No. 76633 October 18, 1988
EASTERN SHIPPING LINES, INC., petitioner,
vs.
PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION (POEA),
MINISTER OF LABOR AND EMPLOYMENT, HEARING OFFICER
ABDUL BASAR and KATHLEEN D. SACO, respondents.
Jimenea, Dala & Zaragoza Law Office for petitioner.
The Solicitor General for public respondent.
Dizon Law Office for respondent Kathleen D. Saco.
CRUZ, J.:
The private respondent in this case was awarded the sum of P192,000.00 by the Philippine Overseas
Employment Administration (POEA) for the death of her husband. The decision is challenged by the
petitioner on the principal ground that the POEA had no jurisdiction over the case as the husband was
not an overseas worker.
Vitaliano Saco was Chief Officer of the M/V Eastern Polaris when he was
killed in an accident in Tokyo, Japan, March 15, 1985. His widow sued for
damages under Executive Order No. 797 and Memorandum Circular No.
2 of the POEA. The petitioner, as owner of the vessel, argued that the
complaint was cognizable not by the POEA but by the Social Security
System and should have been filed against the State Insurance Fund.
The POEA nevertheless assumed jurisdiction and after considering the
position papers of the parties ruled in favor of the complainant. The
award consisted of P180,000.00 as death benefits and P12,000.00 for
burial expenses.
The petitioner immediately came to this Court, prompting the Solicitor
General to move for dismissal on the ground of non-exhaustion of
administrative remedies.
Ordinarily, the decisions of the POEA should first be appealed to the
National Labor Relations Commission, on the theory inter alia that the
agency should be given an opportunity to correct the errors, if any, of its
subordinates. This case comes under one of the exceptions, however, as
the questions the petitioner is raising are essentially questions of
law. 1 Moreover, the private respondent himself has not objected to the
petitioner's direct resort to this Court, observing that the usual procedure
would delay the disposition of the case to her prejudice.
The Philippine Overseas Employment Administration was created under
Executive Order No. 797, promulgated on May 1, 1982, to promote and
monitor the overseas employment of Filipinos and to protect their rights. It
replaced the National Seamen Board created earlier under Article 20 of
the Labor Code in 1974. Under Section 4(a) of the said executive order,
the POEA is vested with "original and exclusive jurisdiction over all
cases, including money claims, involving employee-employer relations
arising out of or by virtue of any law or contract involving Filipino contract
workers, including seamen." These cases, according to the 1985 Rules
and Regulations on Overseas Employment issued by the POEA, include
"claims for death, disability and other benefits" arising out of such
employment. 2
The petitioner does not contend that Saco was not its employee or that
the claim of his widow is not compensable. What it does urge is that he
was not an overseas worker but a 'domestic employee and consequently
his widow's claim should have been filed with Social Security System,
subject to appeal to the Employees Compensation Commission.
We see no reason to disturb the factual finding of the POEA that Vitaliano
Saco was an overseas employee of the petitioner at the time he met with
the fatal accident in Japan in 1985.
Under the 1985 Rules and Regulations on Overseas Employment,
overseas employment is defined as "employment of a worker outside the
Philippines, including employment on board vessels plying international
waters, covered by a valid contract. 3 A contract worker is described as
"any person working or who has worked overseas under a valid
employment contract and shall include seamen" 4 or "any person working
overseas or who has been employed by another which may be a local
employer, foreign employer, principal or partner under a valid
employment contract and shall include seamen." 5 These definitions
clearly apply to Vitaliano Saco for it is not disputed that he died while
under a contract of employment with the petitioner and alongside the
petitioner's vessel, the M/V Eastern Polaris, while berthed in a foreign
country. 6
It is worth observing that the petitioner performed at least two acts which
constitute implied or tacit recognition of the nature of Saco's employment
at the time of his death in 1985. The first is its submission of its shipping
articles to the POEA for processing, formalization and approval in the
exercise of its regulatory power over overseas employment under
Executive Order NO. 797. 7 The second is its payment 8 of the
contributions mandated by law and regulations to the Welfare Fund for
Overseas Workers, which was created by P.D. No. 1694 "for the purpose
of providing social and welfare services to Filipino overseas workers."
Significantly, the office administering this fund, in the receipt it prepared
for the private respondent's signature, described the subject of the burial
benefits as "overseas contract worker Vitaliano Saco." 9 While this receipt
is certainly not controlling, it does indicate, in the light of the petitioner's
own previous acts, that the petitioner and the Fund to which it had made
contributions considered Saco to be an overseas employee.
The petitioner argues that the deceased employee should be likened to
the employees of the Philippine Air Lines who, although working abroad
in its international flights, are not considered overseas workers. If this be
so, the petitioner should not have found it necessary to submit its
shipping articles to the POEA for processing, formalization and approval
or to contribute to the Welfare Fund which is available only to overseas
workers. Moreover, the analogy is hardly appropriate as the employees
of the PAL cannot under the definitions given be considered seamen nor
are their appointments coursed through the POEA.
The award of P180,000.00 for death benefits and P12,000.00 for burial
expenses was made by the POEA pursuant to its Memorandum Circular
No. 2, which became effective on February 1, 1984. This circular
prescribed a standard contract to be adopted by both foreign and
domestic shipping companies in the hiring of Filipino seamen for
overseas employment. A similar contract had earlier been required by the
National Seamen Board and had been sustained in a number of cases by
this Court. 10 The petitioner claims that it had never entered into such a
contract with the deceased Saco, but that is hardly a serious argument.
In the first place, it should have done so as required by the circular, which
specifically declared that "all parties to the employment of any Filipino
seamen on board any ocean-going vessel are advised to adopt and use
this employment contract effective 01 February 1984 and to desist from
using any other format of employment contract effective that date." In the
second place, even if it had not done so, the provisions of the said
circular are nevertheless deemed written into the contract with Saco as a
postulate of the police power of the State. 11
But the petitioner questions the validity of Memorandum Circular No. 2
itself as violative of the principle of non-delegation of legislative power. It
contends that no authority had been given the POEA to promulgate the
said regulation; and even with such authorization, the regulation
represents an exercise of legislative discretion which, under the principle,
is not subject to delegation.
The authority to issue the said regulation is clearly provided in Section
4(a) of Executive Order No. 797, reading as follows:
... The governing Board of the Administration (POEA), as
hereunder provided shall promulgate the necessary rules
and regulations to govern the exercise of the adjudicatory
functions of the Administration (POEA).
Similar authorization had been granted the National Seamen Board,
which, as earlier observed, had itself prescribed a standard shipping
contract substantially the same as the format adopted by the POEA.
The second challenge is more serious as it is true that legislative
discretion as to the substantive contents of the law cannot be delegated.
What can be delegated is the discretion to determine how the law may be
enforced, not what the law shall be. The ascertainment of the latter
subject is a prerogative of the legislature. This prerogative cannot be
abdicated or surrendered by the legislature to the delegate. Thus, in Ynot
v. Intermediate Apellate Court 12 which annulled Executive Order No. 626,
this Court held:
We also mark, on top of all this, the questionable manner
of the disposition of the confiscated property as
prescribed in the questioned executive order. It is there
authorized that the seized property shall be distributed to
charitable institutions and other similar institutions as the
Chairman of the National Meat Inspection
Commission may see fit, in the case of carabaos.' (Italics
supplied.) The phrase "may see fit" is an extremely
generous and dangerous condition, if condition it is. It is
laden with perilous opportunities for partiality and abuse,
and even corruption. One searches in vain for the usual
standard and the reasonable guidelines, or better still, the
limitations that the officers must observe when they make
their distribution. There is none. Their options are
apparently boundless. Who shall be the fortunate
beneficiaries of their generosity and by what criteria shall
they be chosen? Only the officers named can supply the
answer, they and they alone may choose the grantee as
they see fit, and in their own exclusive discretion.
Definitely, there is here a 'roving commission a wide and
sweeping authority that is not canalized within banks that
keep it from overflowing,' in short a clearly profligate and
therefore invalid delegation of legislative powers.
There are two accepted tests to determine whether or not there is a valid
delegation of legislative power, viz, the completeness test and the
sufficient standard test. Under the first test, the law must be complete in
all its terms and conditions when it leaves the legislature such that when
it reaches the delegate the only thing he will have to do is enforce
it. 13 Under the sufficient standard test, there must be adequate guidelines
or stations in the law to map out the boundaries of the delegate's
authority and prevent the delegation from running riot. 14
Both tests are intended to prevent a total transference of legislative
authority to the delegate, who is not allowed to step into the shoes of the
legislature and exercise a power essentially legislative.
The principle of non-delegation of powers is applicable to all the three
major powers of the Government but is especially important in the case of
the legislative power because of the many instances when its delegation
is permitted. The occasions are rare when executive or judicial powers
have to be delegated by the authorities to which they legally certain. In
the case of the legislative power, however, such occasions have become
more and more frequent, if not necessary. This had led to the observation
that the delegation of legislative power has become the rule and its non-
delegation the exception.
The reason is the increasing complexity of the task of government and
the growing inability of the legislature to cope directly with the myriad
problems demanding its attention. The growth of society has ramified its
activities and created peculiar and sophisticated problems that the
legislature cannot be expected reasonably to comprehend. Specialization
even in legislation has become necessary. To many of the problems
attendant upon present-day undertakings, the legislature may not have
the competence to provide the required direct and efficacious, not to say,
specific solutions. These solutions may, however, be expected from its
delegates, who are supposed to be experts in the particular fields
assigned to them.
The reasons given above for the delegation of legislative powers in
general are particularly applicable to administrative bodies. With the
proliferation of specialized activities and their attendant peculiar
problems, the national legislature has found it more and more necessary
to entrust to administrative agencies the authority to issue rules to carry
out the general provisions of the statute. This is called the "power of
subordinate legislation."
With this power, administrative bodies may implement the broad policies
laid down in a statute by "filling in' the details which the Congress may
not have the opportunity or competence to provide. This is effected by
their promulgation of what are known as supplementary regulations, such
as the implementing rules issued by the Department of Labor on the new
Labor Code. These regulations have the force and effect of law.
Memorandum Circular No. 2 is one such administrative regulation. The
model contract prescribed thereby has been applied in a significant
number of the cases without challenge by the employer. The power of the
POEA (and before it the National Seamen Board) in requiring the model
contract is not unlimited as there is a sufficient standard guiding the
delegate in the exercise of the said authority. That standard is
discoverable in the executive order itself which, in creating the Philippine
Overseas Employment Administration, mandated it to protect the rights of
overseas Filipino workers to "fair and equitable employment practices."
Parenthetically, it is recalled that this Court has accepted as sufficient
standards "Public interest" in People v. Rosenthal 15 "justice and equity"
in Antamok Gold Fields v. CIR 16 "public convenience and welfare"
in Calalang v. Williams 17 and "simplicity, economy and efficiency"
in Cervantes v. Auditor General, 18 to mention only a few cases. In the
United States, the "sense and experience of men" was accepted
in Mutual Film Corp. v. Industrial Commission, 19 and "national security"
in Hirabayashi v. United States. 20
It is not denied that the private respondent has been receiving a monthly
death benefit pension of P514.42 since March 1985 and that she was
also paid a P1,000.00 funeral benefit by the Social Security System. In
addition, as already observed, she also received a P5,000.00 burial
gratuity from the Welfare Fund for Overseas Workers. These payments
will not preclude allowance of the private respondent's claim against the
petitioner because it is specifically reserved in the standard contract of
employment for Filipino seamen under Memorandum Circular No. 2,
Series of 1984, that—
Section C. Compensation and Benefits.—
1. In case of death of the seamen during the term of his
Contract, the employer shall pay his beneficiaries the
amount of:
a. P220,000.00 for master and chief
engineers
b. P180,000.00 for other officers, including
radio operators and master electrician
c. P 130,000.00 for ratings.
2. It is understood and agreed that the benefits mentioned
above shall be separate and distinct from, and will be in
addition to whatever benefits which the seaman is entitled
to under Philippine laws. ...
3. ...
c. If the remains of the seaman is buried in
the Philippines, the owners shall pay the
beneficiaries of the seaman an amount
not exceeding P18,000.00 for burial
expenses.
The underscored portion is merely a reiteration of Memorandum Circular
No. 22, issued by the National Seamen Board on July 12,1976, providing
an follows:
Income Benefits under this Rule Shall be Considered
Additional Benefits.—
All compensation benefits under Title II, Book Four of the
Labor Code of the Philippines (Employees Compensation
and State Insurance Fund) shall be granted, in addition to
whatever benefits, gratuities or allowances that the
seaman or his beneficiaries may be entitled to under the
employment contract approved by the NSB. If applicable,
all benefits under the Social Security Law and the
Philippine Medicare Law shall be enjoyed by the seaman
or his beneficiaries in accordance with such laws.
The above provisions are manifestations of the concern of the State for
the working class, consistently with the social justice policy and the
specific provisions in the Constitution for the protection of the working
class and the promotion of its interest.
One last challenge of the petitioner must be dealt with to close t case. Its
argument that it has been denied due process because the same POEA
that issued Memorandum Circular No. 2 has also sustained and applied it
is an uninformed criticism of administrative law itself. Administrative
agencies are vested with two basic powers, the quasi-legislative and the
quasi-judicial. The first enables them to promulgate implementing rules
and regulations, and the second enables them to interpret and apply
such regulations. Examples abound: the Bureau of Internal Revenue
adjudicates on its own revenue regulations, the Central Bank on its own
circulars, the Securities and Exchange Commission on its own rules, as
so too do the Philippine Patent Office and the Videogram Regulatory
Board and the Civil Aeronautics Administration and the Department of
Natural Resources and so on ad infinitum on their respective
administrative regulations. Such an arrangement has been accepted as a
fact of life of modern governments and cannot be considered violative of
due process as long as the cardinal rights laid down by Justice Laurel in
the landmark case of Ang Tibay v. Court of Industrial Relations 21 are
observed.
Whatever doubts may still remain regarding the rights of the parties in
this case are resolved in favor of the private respondent, in line with the
express mandate of the Labor Code and the principle that those with less
in life should have more in law.
When the conflicting interests of labor and capital are weighed on the
scales of social justice, the heavier influence of the latter must be
counter-balanced by the sympathy and compassion the law must accord
the underprivileged worker. This is only fair if he is to be given the
opportunity and the right to assert and defend his cause not as a
subordinate but as a peer of management, with which he can negotiate
on even plane. Labor is not a mere employee of capital but its active and
equal partner.
WHEREFORE, the petition is DISMISSED, with costs against the
petitioner. The temporary restraining order dated December 10, 1986 is
hereby LIFTED. It is so ordered.
G.R. No. L-32096 October 24, 1970
ROMEO F. EDU, in his capacity as Land Transportation
Commissioner, petitioner,
vs.
HON. VICENTE G. ERICTA in his capacity as Judge of the Court of
First Instance of Rizal, Br. XVIII, Quezon City, and TEDDY C.
GALO respondents.
Office of the Solicitor General Felix Q. Antonio, Acting Assistant Solicitor
General Hector C. Fule and Solicitor Vicente A. Torres for petitioner.
Teddy C. Galo in his own behalf.
Judge Vicente Ericta in his own behalf.
FERNANDO, J.:.
Petitioner Romeo F. Edu, the Land Transportation Commissioner, would
have us rule squarely on the constitutionality of the Reflector Law1 in this
proceeding for certiorari and prohibition against respondent Judge, the
Honorable Vicente G. Ericta of the Court of First Instance of Rizal, Quezon
City Branch, to annul and set aside his order for the issuance of a writ of
preliminary injunction directed against Administrative Order No. 2 of
petitioner for the enforcement of the aforesaid statute, in a pending suit in his
court for certiorari and prohibition, filed by the other respondent Teddy C.
Galo assailing; the validity of such enactment as well as such administrative
order. Respondent Judge, in his answer, would join such a plea asking that
the constitutional and legal questions raised be decided "once and for all."
Respondent Teddy C. Galo who was quite categorical in his assertion that
both the challenged legislation and the administrative order transgress the
constitutional requirements of due process and non-delegation, is not averse
either to such a definitive ruling. Considering the great public interest
involved and the reliance by respondent Galo and the allegation that the
repugnancy to the fundamental law could be discerned on the face of the
statute as enacted and the executive order as promulgated, this Court, sees
no obstacle to the determination in this proceeding of the constitutional
questions raised. For reasons to be hereafter stated, we sustain the validity
of the Reflector Law and Administrative Order No. 2 issued in the
implementation thereof, the imputation of constitutional infirmity being at best
flimsy and insubstantial.
As noted in the answer of respondent Judge, respondent Galo on his
behalf and that of other motorist filed on May 20, 1970 a suit for certiorari
and prohibition with preliminary injunction assailing the validity of the
challenged Act as an invalid exercise of the police power, for being
violative of the due process clause. This he followed on May 28, 1970
with a manifestation wherein he sought as an alternative remedy that, in
the event that respondent Judge would hold said statute constitutional,
Administrative Order No. 2 of the Land Transportation Commissioner,
now petitioner, implementing such legislation be nullified as an undue
exercise of legislative power. There was a hearing on the plea for the
issuance of a writ of preliminary injunction held on May 27. 1970 where
both parties were duly represented, but no evidence was presented. The
next day, on May 28, 1970, respondent Judge ordered the issuance of a
preliminary injunction directed against the enforcement of such
administrative order. There was the day after, a motion for its
reconsideration filed by the Solicitor General representing petitioner. In
the meanwhile, the clerk of court of respondent Judge issued, on June 1,
1970 the writ of preliminary injunction upon the filing of the required bond.
The answer before the lower court was filed by petitioner Edu on June 4,
1970. Thereafter, on June 9, 1970, respondent Judge denied the motion
for reconsideration of the order of injunction. Hence this petition for
certiorari and prohibition filed with this court on June 18, 1970.
In a resolution of June 22, 1970, this Court required respondents to file
an answer to the petition for certiorari and prohibition. Respondent
Judge, the Honorable Vicente G. Ericta, did file his answer on June 30,
1970 explaining why he restrained the enforcement of Administrative
Order No. 2 and, as noted at the outset, joining the Solicitor General in
seeking that the legal questions raised namely the constitutionality of the
Reflector Law and secondly the validity of Administrative Order No. 2
alleged to be in excess of the authority conferred on petitioner and
therefore violative of the principle of non-delegation of legislative power
be definitely decided. It was on until July 6, 1970 that respondent Galo
filed his answer seeking the dismissal of this petition concentrating on
what he considered to be the patent invalidity of Administrative Order No.
2 as it went beyond the authority granted by the Reflector Law, even
assuming that it is constitutional. In the meanwhile, on July 2, 1970, the
petition was called for hearing with Solicitor Vicente Torres appearing for
petitioner and respondent Galo for himself. It was made clear during the
course of such argumentation that the matter of the constitutionality of
the Reflector Law was likewise under consideration by this Court. The
case is thus ripe for decision.
We repeat that we find for petitioner and sustain the Constitutionality of
the Reflector Law as well as the validity of Administrative Order No. 2.
1. The threshold question is whether on the basis of the petition, the
answers, and the oral argument, it would be proper for this Court to
resolve the issue of the constitutionality of the Reflector Law. Our
answer, as indicated, is in the affirmative. It is to be noted that the main
thrust of the petition before us is to demonstrate in a rather convincing
fashion that the challenged legislation does not suffer from the alleged
constitutional infirmity imputed to it by the respondent Galo. Since the
special civil action for certiorari and prohibition filed before him before
respondent Judge would seek a declaration of nullity of such enactment
by the attribution of the violation the face thereof of the due process
guarantee in the deprivation of property rights, it would follow that there is
sufficient basis for us to determine which view should prevail. Moreover,
any further hearing by respondent Judge would likewise to limited to a
discussion of the constitutional issues raised, no allegations of facts
having made. This is one case then where the question of validity is ripe
for determination. If we do so, further effort need not be wasted and time
is saved moreover, the officials concerned as well as the public, both
vitally concerned with a final resolution of questions of validity, could
know the definitive answer and could act accordingly. There is a great
public interest, as was mentioned, to be served by the final disposition of
such crucial issue, petitioner praying that respondent Galo be declared
having no cause of action with respondent Judge being accordingly
directed to dismiss his suit.
There is another reinforcement to this avenue of approach. We have
done so before in a suit, Climaco v. Macadaeg, 2 involving the legality of a
presidential directive. That was a petition for the review and reversal of a writ of preliminary injunction
issued by the then Judge Macadaeg. We there announced that we "have decided to pass upon the
question of the validity of the presidential directive ourselves, believing that by doing so we would be
putting an end to a dispute, a delay in the disposition of which has caused considerable damage and
injury to the Government and to the tobacco planters themselves."
There is no principle of constitutional adjudication that bars this Court
from similarly passing upon the question of the validity of a legislative
enactment in a proceeding before it to test the propriety of the issuance
of a preliminary injunction. The same felt need for resolving once and for
all the vexing question as to the constitutionality of a challenged
enactment and thus serve public interest exists. What we have done in
the case of an order proceeding from one of the coordinate branches, the
executive, we can very well do in the matter before us involving the
alleged nullity of a legislative act. Accordingly, there is nothing to
preclude the grant of the writs prayed for, the burden of showing the
constitutionality of the act having proved to be as will now be shown too
much for respondent Galo.
2. The Reflector Law reads in full: "(g) Lights and reflector when parked
or disabled. — Appropriate parking lights or flares visible one hundred
meters away shall be displayed at a corner of the vehicle whenever such
vehicle is parked on highways or in places that are not well-lighted or is
placed in such manner as to endanger passing traffic. Furthermore, every
motor vehicle shall be provided at all times with built-in reflectors or other
similar warning devices either pasted, painted or attached to its front and
back which shall likewise be visible at light at least one hundred meters
away. No vehicle not provided with any of the requirements mentioned in
this subsection shall be registered."3 It is thus obvious that the challenged
statute is a legislation enacted under the police power to promote public
safety.
Justice Laurel, in the first leading decision after the Constitution came to
force, Calalang v. Williams,4 identified police power with state authority to
enact legislation that may interfere with personal liberty or property in order
to promote the general welfare. Persons and property could thus "be
subjected to all kinds of restraints and burdens in order to secure the general
comfort, health and prosperity of the state." Shortly after independence in
1948, Primicias v. Fugoso,5 reiterated the doctrine, such a competence being
referred to as "the power to prescribe regulations to promote the health,
morals, peace, education, good order or safety, and general welfare of the
people." The concept was set forth in negative terms by Justice Malcolm in a
pre-Commonwealth decision as "that inherent and plenary power in the State
which enables it to prohibit all things hurtful to the comfort, safety and welfare
of society."6 In that sense it could be hardly distinguishable as noted by this
Court in Morfe v. Mutuc7 with the totality of legislative power.
It is in the above sense the greatest and most powerful attribute of
government. It is to quote Justice Malcolm anew "the most essential,
insistent, and at least illimitable of powers," 8 extending as Justice Holmes aptly
pointed out "to all the great public needs." 9 Its scope, ever-expanding to meet the exigencies of the
times, even to anticipate the future where it could be done, provides enough room for an efficient and
flexible response to conditions and circumstances thus assuring the greatest benefits. In the language
of Justice Cardozo: "Needs that were narrow or parochial in the past may be interwoven in the present
with the well-being of the nation. What is critical or urgent changes with the
time." 10 The police power is thus a dynamic agency, suitably vague and far
from precisely defined, rooted in the conception that men in organizing the
state and imposing upon its government limitations to safeguard
constitutional rights did not intend thereby to enable an individual citizen or a
group of citizens to obstruct unreasonably the enactment of such salutary
measures calculated to insure communal peace, safety, good order, and
welfare.
It would then be to overturn a host of decisions impressive for their
number and unanimity were this Court to sustain respondent Galo. 11 That
we are not disposed to do, especially so as the attack on the challenged
statute ostensibly for disregarding the due process safeguard is angularly
unpersuasive. It would be to close one's eyes to the hazards of traffic in the
evening to condemn a statute of this character. Such an attitude betrays lack
of concern for public safety. How can it plausibly alleged then that there was
no observance of due process equated as it has always been with that is
reasonable? The statute assailed is not infected with arbitrariness. It is not
the product of whim or caprice. It is far from oppressive. It is a legitimate
response to a felt public need. It can stand the test of the most
unsymphatetic appraisal.
Respondent Galo is of a different mind, having been unable to resist the
teaching of many American State Court decisions referred to in the
secondary source, American Jurisprudence principally relied upon by
him. He ought to have been cautioned against an indiscriminate
acceptance of such doctrines predicated on what was once a
fundamental postulate in American public law, laissez faire.
It is to be admitted that there was a period when such a concept did
influence American court decisions on constitutional law. As was explicitly
stated by Justice Cardozo speaking of that era: "Laissez-faire was not
only a counsel of caution which would do well to heed. It was a
categorical imperative which statesmen as well as judges must
obey." 12 For a long time legislation tending to reduce economic inequality
foundered on the rock that was the due process clause, enshrining as it did
the liberty of contract, based on such a basic assumption.
The New Deal administration of President Roosevelt more responsive to
the social and economic forces at work changed matters greatly. By
1937, there was a greater receptivity by the American Supreme Court to
an approach not too reverential of property rights. Even earlier, in 1935,
Professor Coker of Yale, speaking as a historian, could already discern a
contrary drift. He did note the expending range of governmental activity in
the United States. 13 What is undeniable is that by 1943, laissez-faire was
no longer the dominant theory. In the language of Justice Jackson in the
leading case of West Virginia State Board of Education v. Barnette: 14 "We
must, transplant these rights to a soil in which the laissez-faire concept or
non-interference has withered at least as to economic affairs, and social
advancements are increasingly sought through closer integration of society
and through expanded and strengthened governmental controls."
While authoritative precedents from the United States federal and state
jurisdictions were deferred to when the Philippines was still under
American rule, it cannot be said that the laissez-faire principle was
invariably adhered to by us even then As early as 1919, in the leading
case of Rubi v. Provincial Board of Mindoro, 15 Justice Malcolm already
had occasion to affirm: "The doctrines of laissez-faire and of unrestricted
freedom of the individual, as axioms of economic and political theory, are of
the past. The modern period has shown a widespread belief in the amplest
possible demonstration of government activity. The Courts unfortunately
have sometimes seemed to trail after the other two branches of the
Government in this progressive march." People v. Pomar, 16 a 1924 decision
which held invalid under the due process clause a provision providing for
maternity leave with pay thirty days before and thirty days after confinement
could be cited to show that such a principle did have its day. It is to be
remembered though that our Supreme Court had no other choice as the
Philippines was then under the United States, and only recently the year
before, the American Supreme Court in Adkins v. Children's Hospital, 17 in
line with the laissez-faire theory, did hold that a statute providing for minimum
wages was constitutionally infirm.
What is more, to erase any doubts, the Constitutional Convention saw to
it that the concept of laissez-faire was rejected. It entrusted to our
government the responsibility of coping with social and economic
problems with the commensurate power of control over economic affairs.
Thereby it could live up to its commitment to promote the general welfare
through state action. No constitutional objection to regulatory measures
adversely affecting property rights, especially so when public safety is the
aim, is likely to be heeded, unless of course on the clearest and most
satisfactory proof of invasion of rights guaranteed by the Constitution. On
such a showing, there may be a declaration of nullity, but not because
the laissez-faire principle was disregarded but because the due process,
equal protection, or non-impairment guarantees would call for vindication.
To repeat, our Constitution which took effect in 1935 erased whatever
doubts there might be on that score. Its philosophy is a repudiation
of laissez-faire. One of the leading members of the Constitutional
Convention, Manuel A. Roxas, later the first President of the Republic,
made it clear when he disposed of the objection of Delegate Jose Reyes
of Sorsogon, who noted the "vast extensions in the sphere of
governmental functions" and the "almost unlimited power to interfere in
the affairs of industry and agriculture as well as to compete with existing
business" as "reflections of the fascination exerted by [the then] current
tendencies" in other jurisdictions. 18 He spoke thus: "My answer is that this
constitution has definite and well defined philosophy not only political but
social and economic. ... If in this Constitution the gentlemen will find
declarations of economic policy they are there because they are necessary
to safeguard the interests and welfare of the Filipino people because we
believe that the days have come when in self-defense, a nation may provide
in its constitution those safeguards, the patrimony, the freedom to grow, the
freedom to develop national aspirations and national interests, not to be
hampered by the artificial boundaries which a constitutional provision
automatically imposes. 19
It was not expected then when in a concurring opinion, Justice Laurel,
who likewise sat in the Constitutional Convention and was one of its
leading lights, explicitly affirmed in a concurring opinion, later quoted with
approval in the leading case of Antamok Goldfields Mining Co. v. Court of
Industrial Relations, 20 that the Constitution did away with the laissez-faire doctrine. In the
course of such concurring opinion and after noting the changes that have taken place calling for a
more affirmative role by the government and its undeniable power to curtail property rights, he
categorically declared the doctrine in People v. Pomar no longer retains "its virtuality as a living
principle." 21
It is in the light of such rejection of the laissez-faire principle that during
the Commonwealth era, no constitutional infirmity was found to have
attached to legislation covering such subjects as collective
bargaining, 22 security of tenure, 23 minimum wages, 24 compulsory arbitration, 25 the regulation
of tenancy 26 as well as the issuance of
securities, 27 and control of public services. 28 So it is likewise under the Republic this Court having
given the seal of approval to more favorable tenancy laws, 29 nationalization of the retail
trade, 30 limitation of the hours of labor, 31 imposition of price
control, 32 requirement of separation pay for one month, 33 and social security
scheme. 34
Respondent Galo thus could have profited by a little more diligence in the
scrutiny of Philippine decisions rendered with not unexpected regularity,
during all the while our Constitution has been in force attesting to the
demise of such a shibboleth as laissez-faire. It was one of those fighting
faiths that time and circumstances had upset, to paraphrase Holmes. Yet
respondent Galo would seek to vivify and resurrect it. That, it would
appear, is a vain quest, a futile undertaking. The Reflector Law is thus
immune from the attack so recklessly hurled against it. It can survive, and
quite easily too, the constitutional test.
3. The same lack of success marks the effort of respondent Galo to
impugn the validity of Administrative Order No. 2 issued by petitioner in
his official capacity, duly approved by the Secretary of Public Works and
Communications, for being contrary to the principle of non-delegation of
legislative power. Such administrative order, which took effect on April
17, 1970, has a provision on reflectors in effect reproducing what was set
forth in the Act. Thus: "No motor vehicles of whatever style, kind, make,
class or denomination shall be registered if not equipped with reflectors.
Such reflectors shall either be factory built-in-reflector commercial glass
reflectors, reflection tape or luminous paint. The luminosity shall have an
intensity to be maintained visible and clean at all times such that if struck
by a beam of light shall be visible 100 meters away at night." 35 Then
came a section on dimensions, placement and color. As to dimensions the
following is provided for: "Glass reflectors — Not less than 3 inches in
diameter or not less than 3 inches square; Reflectorized Tape — At least 3
inches wide and 12 inches long. The painted or taped area may be bigger at
the discretion of the vehicle owner." 36 Provision is then made as to how such
reflectors are to be "placed, installed, pasted or painted." 37 There is the
further requirement that in addition to such reflectors there shall be installed,
pasted or painted four reflectors on each side of the motor vehicle parallel to
those installed, pasted or painted in front and those in the rear end of the
body thereof. 38 The color required of each reflectors, whether built-in,
commercial glass, reflectorized tape or reflectorized paint placed in the front
part of any motor vehicle shall be amber or yellow and those placed on the
sides and in the rear shall all be red. 39
Penalties resulting from a violation thereof could be imposed. Thus:
"Non-compliance with the requirements contained in this Order shall be
sufficient cause to refuse registration of the motor vehicle affected and if
already registered, its registration maybe suspended in pursuance of the
provisions of Section 16 of RA 4136; [Provided], However, that in the
case of the violation of Section 1(a) and (b) and paragraph (8) Section 3
hereof, a fine of not less than ten nor more than fifty pesos shall be
imposed. 40 It is not to be lost sight of that under Republic Act No. 4136, of
which the Reflector Law is an amendment, petitioner, as the Land
Transportation Commissioner, may, with the approval of the Secretary of
Public Works and Communications, issue rules and regulations for its
implementation as long as they do not conflict with its provisions. 41 It is
likewise an express provision of the above statute that for a violation of any
of its provisions or regulations promulgated pursuant thereto a fine of not less
than P10 nor not less than P50 could be imposed. 42
It is a fundamental principle flowing from the doctrine of separation of
powers that Congress may not delegate its legislative power to the two
other branches of the government, subject to the exception that local
governments may over local affairs participate in its exercise. What
cannot be delegated is the authority under the Constitution to make laws
and to alter and repeal them; the test is the completeness of the statute
in all its term and provisions when it leaves the hands of the legislature.
To determine whether or not there is an undue delegation of legislative
power the inquiry must be directed to the scope and definiteness of the
measure enacted. The legislature does not abdicate its functions when it
describes what job must be done, who is to do it, and what is the scope
of his authority. For a complex economy, that may indeed be the only
way in which the legislative process can go forward. A distinction has
rightfully been made between delegation of power to make the laws
which necessarily involves a discretion as to what it shall be, which
constitutionally may not be done, and delegation of authority or discretion
as to its execution to exercised under and in pursuance of the law, to
which no valid objection call be made. The Constitution is thus not to be
regarded as denying the legislature the necessary resources of flexibility
and practicability.
To avoid the taint of unlawful delegation, there must be a standard, which
implies at the very least that the legislature itself determines matters of
principle and lay down fundamental policy. Otherwise, the charge of
complete abdication may be hard to repel. A standard thus defines
legislative policy, marks its limits, its maps out its boundaries and
specifies the public agency to apply it. It indicates the circumstances
under which the legislative command is to be effected. It is the criterion
by which legislative purpose may be carried out. Thereafter, the
executive or administrative office designated may in pursuance of the
above guidelines promulgate supplemental rules and regulations.
The standard may be either express or implied. If the former, the non-
delegation objection is easily met. The standard though does not have to
be spelled out specifically. It could be implied from the policy and
purpose of the act considered as a whole. In the Reflector Law, clearly
the legislative objective is public safety. That is sought to be attained as
in Calalang v. Williams is "safe transit upon the roads." 43
This is to adhere to the recognition given expression by Justice Laurel in
a decision announced not long after the Constitution came into force and
effect that the principle of non-delegation "has been made to adapt itself
the complexities of modern governments, giving rise to the adoption,
within certain limits, of the principle of "subordinate legislation" not only in
the United States and England but in practically all modern
governments." 44 He continued: "Accordingly, with the growing complexity of
modern life, the multiplication of the subjects of governmental regulation, and
the increased difficulty of administering the laws, there is a constantly
growing tendency toward the delegation of greater powers by the legislature
and toward the approval of the practice by the courts." 45 Consistency with
the conceptual approach requires the reminder that what is delegated is
authority non-legislative in character, the completeness of the statute when it
leaves the hands of Congress being assumed.
Our later decisions speak to the same effect. Thus from, Justice J. B. L. easily survive the attack, far-from-formidable, launched against it by
Reyes in People vs. Exconde: 46 "It is well establish in this jurisdiction that, respondent Galo.
while the making of laws is a non-delegable activity that corresponds
exclusively to Congress, nevertheless the latter may constitutionally delegate WHEREFORE, the writs of certiorari and prohibition prayed for are
authority to promulgate rules and regulations to implement a given legislation granted, the orders of May 28, 1970 of respondent Judge for the
and effectuate its policies, for the reason that the legislature often finds it issuance of a writ of preliminary injunction, the writ of preliminary
impracticable (if not impossible) to anticipate and proved for the multifarious injunction of June 1, 1970 and his order of June 9, 1970 denying
and complex situations that may be met in carrying the law in effect. All that
reconsideration are annulled and set aside. Respondent Judge is
is required is that the regulation should germane to the objects and purposes
likewise directed to dismiss the petition for certiorari and prohibition filed
of the law; that the regulation be not in contradiction with it; but conform to
the standards that the law prescribes ... " 47
by respondent Teddy C. Galo, there being no cause of action as the
Reflector Law and Administrative Order No. 2 of petitioner have not been
shown to be tainted by invalidity. Without pronouncement as to costs.
An even more explicit formulation of the controlling principle comes from
the pen of the then Justice, now Chief Justice, Concepcion: "Lastly, the
legality of Circular No. 21 is assailed upon the ground that the grant of
authority to issue the same constitutes an undue delegation of legislative
power. It is true that, under our system of government, said power may
not be delegated except to local governments. However, one thing is to
delegate the power to determine what the law shall be, and another thing
to delegate the authority to fix the details in the execution of enforcement
of a policy set out in the law itself. Briefly stated, the rule is that the
delegated powers fall under the second category, if the law authorizing
the, delegation furnishes a reasonable standard which "sufficiently marks
the field within which the Administrator is to act so that it may be known
whether he has kept within it in compliance with the legislative will."
(Yakus vs. United States, 88 L. ed.
848) ... It should be noted, furthermore, that these powers must be
construed and exercised in relation to the objectives of the law creating
the Central Bank, which are, among others, "to maintain monetary
stability in the Philippines," and "to promote a rising level of production,
employment and real income in the Philippines." (Section 2, Rep. Act No.
265). These standards are sufficiently concrete and definite to vest in the
delegated authority, the character of administrative details in the
enforcement of the law and to place the grant said authority beyond the
category of a delegation of legislative powers ... " 48

It bears repeating that the Reflector Law construed together with the
Land Transportation Code. Republic Act No. 4136, of which it is an
amendment, leaves no doubt as to the stress and emphasis on public
safety which is the prime consideration in statutes of this character. There
is likewise a categorical affirmation Of the power of petitioner as Land
Transportation Commissioner to promulgate rules and regulations to give
life to and translate into actuality such fundamental purpose. His power is
clear. There has been no abuse. His Administrative Order No. 2 can
G.R. No. L-23825 December 24, 1965
EMMANUEL PELAEZ, petitioner,
vs.
THE AUDITOR GENERAL, respondent.
Zulueta, Gonzales, Paculdo and Associates for petitioner.
Office of the Solicitor General for respondent.
CONCEPCION, J.:
During the period from September 4 to October 29, 1964 the President of
the Philippines, purporting to act pursuant to Section 68 of the Revised
Administrative Code, issued Executive Orders Nos. 93 to 121, 124 and
126 to 129; creating thirty-three (33) municipalities enumerated in the
margin.1 Soon after the date last mentioned, or on November 10, 1964
petitioner Emmanuel Pelaez, as Vice President of the Philippines and as
taxpayer, instituted the present special civil action, for a writ of prohibition
with preliminary injunction, against the Auditor General, to restrain him,
as well as his representatives and agents, from passing in audit any
expenditure of public funds in implementation of said executive orders
and/or any disbursement by said municipalities.
Petitioner alleges that said executive orders are null and void, upon the
ground that said Section 68 has been impliedly repealed by Republic Act
No. 2370 and constitutes an undue delegation of legislative power.
Respondent maintains the contrary view and avers that the present
action is premature and that not all proper parties — referring to the
officials of the new political subdivisions in question — have been
impleaded. Subsequently, the mayors of several municipalities adversely
affected by the aforementioned executive orders — because the latter
have taken away from the former the barrios composing the new political
subdivisions — intervened in the case. Moreover, Attorneys Enrique M.
Fernando and Emma Quisumbing-Fernando were allowed to and did
appear as amici curiae.
The third paragraph of Section 3 of Republic Act No. 2370, reads:
Barrios shall not be created or their boundaries altered nor their
names changed except under the provisions of this Act or by Act
of Congress.
Pursuant to the first two (2) paragraphs of the same Section 3:
All barrios existing at the time of the passage of this Act shall
come under the provisions hereof.
Upon petition of a majority of the voters in the areas affected, a
new barrio may be created or the name of an existing one may be
changed by the provincial board of the province, upon
recommendation of the council of the municipality or
municipalities in which the proposed barrio is stipulated. The
recommendation of the municipal council shall be embodied in a
resolution approved by at least two-thirds of the entire
membership of the said council: Provided, however, That no new
barrio may be created if its population is less than five hundred
persons.
Hence, since January 1, 1960, when Republic Act No. 2370 became
effective, barrios may "not be created or their boundaries altered nor their
names changed" except by Act of Congress or of the corresponding
provincial board "upon petition of a majority of the voters in the areas
affected" and the "recommendation of the council of the municipality or
municipalities in which the proposed barrio is situated." Petitioner argues,
accordingly: "If the President, under this new law, cannot even create a
barrio, can he create a municipality which is composed of several barrios,
since barrios are units of municipalities?"
Respondent answers in the affirmative, upon the theory that a new
municipality can be created without creating new barrios, such as, by
placing old barrios under the jurisdiction of the new municipality. This
theory overlooks, however, the main import of the petitioner's argument,
which is that the statutory denial of the presidential authority to create a
new barrio implies a negation of the bigger power to create
municipalities, each of which consists of several barrios. The cogency
and force of this argument is too obvious to be denied or even
questioned. Founded upon logic and experience, it cannot be offset
except by a clear manifestation of the intent of Congress to the contrary,
and no such manifestation, subsequent to the passage of Republic Act
No. 2379, has been brought to our attention.
Moreover, section 68 of the Revised Administrative Code, upon which the
disputed executive orders are based, provides:
The (Governor-General) President of the Philippines may by
executive order define the boundary, or boundaries, of any
province, subprovince, municipality, [township] municipal district,
 or other political subdivision, and increase or diminish the territory
comprised therein, may divide any province into one or more
subprovinces, separate any political division other than a
province, into such portions as may be required, merge any of
such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government
within any subdivision to such place therein as the public welfare
may require: Provided, That the authorization of the (Philippine
Legislature) Congress of the Philippines shall first be obtained
whenever the boundary of any province or subprovince is to be
defined or any province is to be divided into one or more
subprovinces. When action by the (Governor-General) President
of the Philippines in accordance herewith makes necessary a
change of the territory under the jurisdiction of any administrative
officer or any judicial officer, the (Governor-General) President of
the Philippines, with the recommendation and advice of the head
of the Department having executive control of such officer, shall
redistrict the territory of the several officers affected and assign
such officers to the new districts so formed.
Upon the changing of the limits of political divisions in pursuance
of the foregoing authority, an equitable distribution of the funds
and obligations of the divisions thereby affected shall be made in
such manner as may be recommended by the (Insular Auditor)
Auditor General and approved by the (Governor-General)
President of the Philippines.
Respondent alleges that the power of the President to create
municipalities under this section does not amount to an undue delegation
of legislative power, relying upon Municipality of Cardona vs. Municipality
of Binañgonan (36 Phil. 547), which, he claims, has settled it. Such claim
is untenable, for said case involved, not the creation of a new
municipality, but a mere transfer of territory — from an already
existing municipality (Cardona) to another municipality
(Binañgonan), likewise, existing at the time of and prior to said
transfer (See Gov't of the P.I. ex rel. Municipality of Cardona vs.
Municipality, of Binañgonan [34 Phil. 518, 519-5201) — in consequence
of the fixing and definition, pursuant to Act No. 1748, of the common
boundaries of two municipalities.
It is obvious, however, that, whereas the power to fix such common
boundary, in order to avoid or settle conflicts of jurisdiction between
adjoining municipalities, may partake of an administrative nature —
involving, as it does, the adoption of means and ways to carry into
effect the law creating said municipalities — the authority to create
municipal corporations is essentially legislative in nature. In the language
of other courts, it is "strictly a legislative function" (State ex rel. Higgins
vs. Aicklen, 119 S. 425, January 2, 1959) or "solely and exclusively the
exercise of legislative power" (Udall vs. Severn, May 29, 1938, 79 P. 2d
347-349). As the Supreme Court of Washington has put it (Territory ex
rel. Kelly vs. Stewart, February 13, 1890, 23 Pac. 405, 409), "municipal
corporations are purely the creatures of statutes."
Although1a Congress may delegate to another branch of the Government
the power to fill in the details in the execution, enforcement or
administration of a law, it is essential, to forestall a violation of the
principle of separation of powers, that said law: (a) be complete in itself
— it must set forth therein the policy to be executed, carried out or
implemented by the delegate2 — and (b) fix a standard — the limits of
which are sufficiently determinate or determinable — to which the
delegate must conform in the performance of his functions. 2a Indeed,
without a statutory declaration of policy, the delegate would in effect,
make or formulate such policy, which is the essence of every law; and,
without the aforementioned standard, there would be no means to
determine, with reasonable certainty, whether the delegate has acted
within or beyond the scope of his authority.2b Hence, he could thereby
arrogate upon himself the power, not only to make the law, but, also —
and this is worse — to unmake it, by adopting measures inconsistent with
the end sought to be attained by the Act of Congress, thus nullifying the
principle of separation of powers and the system of checks and balances,
and, consequently, undermining the very foundation of our Republican
system.
Section 68 of the Revised Administrative Code does not meet these well
settled requirements for a valid delegation of the power to fix the details
in the enforcement of a law. It does not enunciate any policy to be carried
out or implemented by the President. Neither does it give a standard
sufficiently precise to avoid the evil effects above referred to. In this
connection, we do not overlook the fact that, under the last clause of the
first sentence of Section 68, the President:
... may change the seat of the government within any
subdivision to such place therein as the public welfare may
require.
It is apparent, however, from the language of this clause, that the phrase
"as the public welfare may require" qualified, not the clauses preceding
the one just quoted, but only the place to which the seat of the
government may be transferred. This fact becomes more apparent when
we consider that said Section 68 was originally Section 1 of Act No.
1748,3 which provided that, "whenever in the judgment of the Governor-
General the public welfare requires, he may, by executive order," effect
the changes enumerated therein (as in said section 68), including the
change of the seat of the government "to such place ... as the public
interest requires." The opening statement of said Section 1 of Act No.
1748 — which was not included in Section 68 of the Revised
Administrative Code — governed the time at which, or the conditions
under which, the powers therein conferred could be exercised; whereas
the last part of the first sentence of said section referred exclusively to
the place to which the seat of the government was to be transferred.
At any rate, the conclusion would be the same, insofar as the case at bar
is concerned, even if we assumed that the phrase "as the public welfare
may require," in said Section 68, qualifies all other clauses thereof. It is
true that in Calalang vs. Williams (70 Phil. 726) and People vs.
Rosenthal (68 Phil. 328), this Court had upheld "public welfare" and
"public interest," respectively, as sufficient standards for a valid
delegation of the authority to execute the law. But, the doctrine laid down
in these cases — as all judicial pronouncements — must be construed in
relation to the specific facts and issues involved therein, outside of which
they do not constitute precedents and have no binding effect. 4 The law
construed in the Calalang case conferred upon the Director of Public
Works, with the approval of the Secretary of Public Works and
Communications, the power to issue rules and regulations to promote
safe transit upon national roads and streets. Upon the other hand, the
Rosenthal case referred to the authority of the Insular Treasurer, under
Act No. 2581, to issue and cancel certificates or permits for the
sale of speculative securities. Both cases involved grants
to administrative officers of powers related to the exercise of their
administrative functions, calling for the determination of questions of fact.
Such is not the nature of the powers dealt with in section 68. As above
indicated, the creation of municipalities, is not an administrative function,
but one which is essentially and eminently legislative in character. The
question of whether or not "public interest" demands the exercise of such
power is not one of fact. it is "purely a legislative question "(Carolina-
Virginia Coastal Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310-
313, 315-318), or a political question (Udall vs. Severn, 79 P. 2d. 347-
349). As the Supreme Court of Wisconsin has aptly characterized it, "the
question as to whether incorporation is for the best interest of the
community in any case is emphatically a question of public policy and
statecraft" (In re Village of North Milwaukee, 67 N.W. 1033, 1035-1037).
For this reason, courts of justice have annulled, as constituting undue
delegation of legislative powers, state laws granting the judicial
department, the power to determine whether certain territories should be
annexed to a particular municipality (Udall vs. Severn, supra, 258-359);
or vesting in a Commission the right to determine the plan and frame of
government of proposed villages and what functions shall be exercised
by the same, although the powers and functions of the village are
specifically limited by statute (In re Municipal Charters, 86 Atl. 307-308);
or conferring upon courts the authority to declare a given town or village
incorporated, and designate its metes and bounds, upon petition of a
majority of the taxable inhabitants thereof, setting forth the area desired
to be included in such village (Territory ex rel Kelly vs. Stewart, 23 Pac.
405-409); or authorizing the territory of a town, containing a given area
and population, to be incorporated as a town, on certain steps being
taken by the inhabitants thereof and on certain determination by a court
and subsequent vote of the inhabitants in favor thereof, insofar as the
court is allowed to determine whether the lands embraced in the petition
"ought justly" to be included in the village, and whether the interest of the
inhabitants will be promoted by such incorporation, and to enlarge and
diminish the boundaries of the proposed village "as justice may require"
(In re Villages of North Milwaukee, 67 N.W. 1035-1037); or creating a
Municipal Board of Control which shall determine whether or not the
laying out, construction or operation of a toll road is in the "public interest"
and whether the requirements of the law had been complied with, in
which case the board shall enter an order creating a municipal
corporation and fixing the name of the same (Carolina-Virginia Coastal
Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310).
Insofar as the validity of a delegation of power by Congress to the
President is concerned, the case of Schechter Poultry Corporation vs.
U.S. (79 L. Ed. 1570) is quite relevant to the one at bar. The Schechter
case involved the constitutionality of Section 3 of the National Industrial
Recovery Act authorizing the President of the United States to approve
"codes of fair competition" submitted to him by one or more trade or
industrial associations or corporations which "impose no inequitable
restrictions on admission to membership therein and are truly
representative," provided that such codes are not designed "to promote
monopolies or to eliminate or oppress small enterprises and will not
operate to discriminate against them, and will tend to effectuate the
policy" of said Act. The Federal Supreme Court held:
To summarize and conclude upon this point: Sec. 3 of the
Recovery Act is without precedent. It supplies no standards for
any trade, industry or activity. It does not undertake to prescribe
 rules of conduct to be applied to particular states of fact
determined by appropriate administrative procedure. Instead of
prescribing rules of conduct, it authorizes the making of codes to
prescribe them. For that legislative undertaking, Sec. 3 sets up no
standards, aside from the statement of the general aims of
rehabilitation, correction and expansion described in Sec. 1. In
view of the scope of that broad declaration, and of the nature of
the few restrictions that are imposed, the discretion of the
President in approving or prescribing codes, and thus enacting
laws for the government of trade and industry throughout the
country, is virtually unfettered. We think that the code making
authority thus conferred is an unconstitutional delegation of
legislative power.
If the term "unfair competition" is so broad as to vest in the President a
discretion that is "virtually unfettered." and, consequently, tantamount to a
delegation of legislative power, it is obvious that "public welfare," which
has even a broader connotation, leads to the same result. In fact, if the
validity of the delegation of powers made in Section 68 were upheld,
there would no longer be any legal impediment to a statutory grant of
authority to the President to do anything which, in his opinion, may be
required by public welfare or public interest. Such grant of authority would
be a virtual abdication of the powers of Congress in favor of the
Executive, and would bring about a total collapse of the democratic
system established by our Constitution, which it is the special duty and
privilege of this Court to uphold.
It may not be amiss to note that the executive orders in question were
issued after the legislative bills for the creation of the municipalities
involved in this case had failed to pass Congress. A better proof of the
fact that the issuance of said executive orders entails the exercise of
purely legislative functions can hardly be given.
Again, Section 10 (1) of Article VII of our fundamental law ordains:
The President shall have control of all the executive departments,
bureaus, or offices, exercise general supervision over all local
governments as may be provided by law, and take care that the
laws be faithfully executed.
The power of control under this provision implies the right of the
President to interfere in the exercise of such discretion as may be vested
by law in the officers of the executive departments, bureaus, or offices of
the national government, as well as to act in lieu of such officers. This
power is denied by the Constitution to the Executive, insofar as local
governments are concerned. With respect to the latter, the fundamental
law permits him to wield no more authority than that of checking whether
said local governments or the officers thereof perform their duties as
provided by statutory enactments. Hence, the President cannot interfere
with local governments, so long as the same or its officers act Within the
scope of their authority. He may not enact an ordinance which the
municipal council has failed or refused to pass, even if it had thereby
violated a duty imposed thereto by law, although he may see to it that the
corresponding provincial officials take appropriate disciplinary action
therefor. Neither may he vote, set aside or annul an ordinance passed by
said council within the scope of its jurisdiction, no matter how patently
unwise it may be. He may not even suspend an elective official of a
regular municipality or take any disciplinary action against him, except on
appeal from a decision of the corresponding provincial board.5
Upon the other hand if the President could create a municipality, he
could, in effect, remove any of its officials, by creating a new municipality
and including therein the barrio in which the official concerned resides,
for his office would thereby become vacant.6 Thus, by merely brandishing
the power to create a new municipality (if he had it), without actually
creating it, he could compel local officials to submit to his dictation,
thereby, in effect, exercising over them the power of control denied to him
by the Constitution.
Then, also, the power of control of the President over executive
departments, bureaus or offices implies no more than the authority to
assume directly the functions thereof or to interfere in the exercise of
discretion by its officials. Manifestly, such control does not include the
authority either to abolish an executive department or bureau, or to
create a new one. As a consequence, the alleged power of the President
to create municipal corporations would necessarily connote the exercise
by him of an authority even greater than that of control which he has over
the executive departments, bureaus or offices. In other words, Section 68
of the Revised Administrative Code does not merely fail to comply with
the constitutional mandate above quoted. Instead of giving the President
less power over local governments than that vested in him over the
executive departments, bureaus or offices, it reverses the process and
does the exact opposite, by conferring upon him more power over
municipal corporations than that which he has over said executive
departments, bureaus or offices.
In short, even if it did entail an undue delegation of legislative powers, as
it certainly does, said Section 68, as part of the Revised Administrative
Code, approved on March 10, 1917, must be deemed repealed by the
subsequent adoption of the Constitution, in 1935, which is utterly
incompatible and inconsistent with said statutory enactment. 7
There are only two (2) other points left for consideration, namely,
respondent's claim (a) that "not all the proper parties" — referring to the
officers of the newly created municipalities — "have been impleaded in
this case," and (b) that "the present petition is premature."
As regards the first point, suffice it to say that the records do not show,
and the parties do not claim, that the officers of any of said municipalities
have been appointed or elected and assumed office. At any rate, the
Solicitor General, who has appeared on behalf of respondent Auditor
General, is the officer authorized by law "to act and represent the
Government of the Philippines, its offices and agents, in any official
investigation, proceeding or matter requiring the services of a lawyer"
(Section 1661, Revised Administrative Code), and, in connection with the
creation of the aforementioned municipalities, which involves a political,
not proprietary, function, said local officials, if any, are mere agents or
representatives of the national government. Their interest in the case at
bar has, accordingly, been, in effect, duly represented. 8
With respect to the second point, respondent alleges that he has not as
yet acted on any of the executive order & in question and has not
intimated how he would act in connection therewith. It is, however, a
matter of common, public knowledge, subject to judicial cognizance, that
the President has, for many years, issued executive orders creating
municipal corporations and that the same have been organized and in
actual operation, thus indicating, without peradventure of doubt, that the
expenditures incidental thereto have been sanctioned, approved or
passed in audit by the General Auditing Office and its officials. There is
no reason to believe, therefore, that respondent would adopt a different
policy as regards the new municipalities involved in this case, in the
absence of an allegation to such effect, and none has been made by him.
WHEREFORE, the Executive Orders in question are hereby declared null
and void ab initio and the respondent permanently restrained from
passing in audit any expenditure of public funds in implementation of said
Executive Orders or any disbursement by the municipalities above
referred to. It is so ordered.
Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera and Dizon,
JJ., concur.
Zaldivar, J., took no part.
Separate Opinions
BENGZON, J.P., J., concurring and dissenting:
A sign of progress in a developing nation is the rise of new municipalities.
Fostering their rapid growth has long been the aim pursued by all three
branches of our Government.
So it was that the Governor-General during the time of the Jones Law
was given authority by the Legislature (Act No. 1748) to act upon certain
details with respect to said local governments, such as fixing of
boundaries, subdivisions and mergers. And the Supreme Court, within
the framework of the Jones Law, ruled in 1917 that the execution or
implementation of such details, did not entail abdication of legislative
power (Government vs. Municipality of Binañgonan, 34 Phil. 518;
Municipality of Cardona vs. Municipality of Binañgonan, 36 Phil. 547).
Subsequently, Act No. 1748's aforesaid statutory authorization was
embodied in Section 68 of the Revised Administrative Code. And Chief
Executives since then up to the present continued to avail of said
provision, time and again invoking it to issue executive orders providing
for the creation of municipalities.
From September 4, 1964 to October 29, 1964 the President of the
Philippines issued executive orders to create thirty-three municipalities
pursuant to Section 68 of the Revised Administrative Code. Public funds
thereby stood to be disbursed in implementation of said executive orders.
Suing as private citizen and taxpayer, Vice President Emmanuel Pelaez
filed in this Court a petition for prohibition with preliminary injunction
against the Auditor General. It seeks to restrain the respondent or any
person acting in his behalf, from passing in audit any expenditure of
public funds in implementation of the executive orders aforementioned.
Petitioner contends that the President has no power to create a
municipality by executive order. It is argued that Section 68 of the
Revised Administrative Code of 1917, so far as it purports to grant any
such power, is invalid or, at the least, already repealed, in light of the
Philippine Constitution and Republic Act 2370 (The Barrio Charter).
Section 68 is again reproduced hereunder for convenience:
SEC. 68. General authority of [Governor-General) President of
the Philippines to fix boundaries and make new subdivisions. —
The [Governor-General] President of the Philippines may by
executive order define the boundary, or boundaries, of any
province, subprovince, municipality, [township] municipal district,
or other political subdivision, and increase or diminish the territory
comprised therein, may divide any province into one or more
subprovinces, separate any political division other than a
province, into such portions as may be required, merge any of
such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government
within any subdivision to such place therein as the public welfare
may require: Provided, That the authorization of the [Philippine
Legislature] Congress of the Philippines shall first be obtained
whenever the boundary of any province or subprovince is to be
defined or any province is to be divided into one or more
subprovinces. When action by the [Governor-General] President
of the Philippines in accordance herewith makes necessary a
change of the territory under the jurisdiction of any administrative
officer or any judicial officer, the [Governor-General] President of
the Philippines, with the recommendation and advice of the head
of the Department having executive control of such officer, shall
redistrict the territory of the several officers to the new districts so
formed.
Upon the changing of the limits of political divisions in pursuance
of the foregoing authority, an equitable distribution of the funds
and obligations of the divisions thereby affected shall be made in
such manner as may be recommended by the [Insular Auditor]
Auditor General and approved by the [Governor-General]
President of the Philippines.
From such working I believe that power to create a municipality is
included: to "separate any political division other than a province, into
such portions as may be required, merge any such subdivisions or
portions with another, name any new subdivision so created." The issue,
however, is whether the legislature can validly delegate to the Executive
such power.
The power to create a municipality is legislative in character. American
authorities have therefore favored the view that it cannot be delegated;
that what is delegable is not the power to create municipalities but only
the power to determine the existence of facts under which creation of a
municipality will result (37 Am. Jur. 628).
The test is said to lie in whether the statute allows any discretion on the
delegate as to whether the municipal corporation should be created. If so,
there is an attempted delegation of legislative power and the statute is
invalid (Ibid.). Now Section 68 no doubt gives the President such
discretion, since it says that the President "may by executive order"
exercise the powers therein granted. Furthermore, Section 5 of the same
Code states:
SEC. 5. Exercise of administrative discretion — The exercise of
the permissive powers of all executive or administrative officers
and bodies is based upon discretion, and when such officer or
body is given authority to do any act but not required to do such
act, the doing of the same shall be dependent on a sound
discretion to be exercised for the good of the service and benefit
of the public, whether so expressed in the statute giving the
authority or not.
Under the prevailing rule in the United States — and Section 68 is of
American origin — the provision in question would be an invalid attempt
to delegate purely legislative powers, contrary to the principle of
separation of powers.
It is very pertinent that Section 68 should be considered with the stream
of history in mind. A proper knowledge of the past is the only adequate
background for the present. Section 68 was adopted half a century ago.
Political change, two world wars, the recognition of our independence
and rightful place in the family of nations, have since taken place. In 1917
the Philippines had for its Organic Act the Jones Law. And under the
setup ordained therein no strict separation of powers was adhered to.
Consequently, Section 68 was not constitutionally objectionable at the
time of its enactment.
The advent of the Philippine Constitution in 1935 however altered the
situation. For not only was separation of powers strictly ordained, except
only in specific instances therein provided, but the power of the Chief
Executive over local governments suffered an explicit reduction.
Formerly, Section 21 of the Jones Law provided that the Governor-
General "shall have general supervision and control of all the
departments and bureaus of the government in the Philippine Islands."
Now Section 10 (1), Article VII of the Philippine Constitution provides:
"The President shall have control of all the executive departments,
bureaus, or offices, exercise general supervision over all local
governments as may be provided by law, and take care that the laws be
faithfully executed.
In short, the power of control over local governments had now been
taken away from the Chief Executive. Again, to fully understand the
significance of this provision, one must trace its development and growth.
As early as April 7, 1900 President McKinley of the United States, in his
Instructions to the Second Philippine Commission, laid down the policy
that our municipal governments should be "subject to the least degree of
supervision and control" on the part of the national government. Said
supervision and control was to be confined within the "narrowest limits" or
so much only as "may be necessary to secure and enforce faithful and
efficient administration by local officers." And the national government
"shall have no direct administration except of matters of purely general
concern." (See Hebron v. Reyes, L-9158, July 28, 1958.)
All this had one aim, to enable the Filipinos to acquire experience in the
art of self-government, with the end in view of later allowing them to
assume complete management and control of the administration of their
local affairs. Such aim is the policy now embodied in Section 10 (1),
Article VII of the Constitution (Rodriguez v. Montinola, 50 O.G. 4820).
It is the evident decree of the Constitution, therefore, that the President
shall have no power of control over local governments. Accordingly,
Congress cannot by law grant him such power (Hebron v. Reyes, supra).
And any such power formerly granted under the Jones Law thereby
became unavoidably inconsistent with the Philippine Constitution.
It remains to examine the relation of the power to create and the power to
control local governments. Said relationship has already been passed
upon by this Court in Hebron v. Reyes, supra. In said case, it was ruled
that the power to control is an incident of the power to create or abolish
municipalities. Respondent's view, therefore, that creating municipalities
and controlling their local governments are "two worlds apart," is
untenable. And since as stated, the power to control local governments
can no longer be conferred on or exercised by the President, it follows
a fortiori that the power to create them, all the more cannot be so
conferred or exercised.
I am compelled to conclude, therefore, that Section 10 (1), Article VII of
the Constitution has repealed Section 68 of the Revised Administrative
Code as far as the latter empowers the President to create local
governments. Repeal by the Constitution of prior statutes inconsistent
with it has already been sustained in De los Santos v. MaIlare, 87 Phil.
289. And it was there held that such repeal differs from a declaration of
unconstitutionality of a posterior legislation, so much so that only a
majority vote of the Court is needed to sustain a finding of repeal.
Since the Constitution repealed Section 68 as far back as 1935, it is
academic to ask whether Republic Act 2370 likewise has provisions in
conflict with Section 68 so as to repeal it. Suffice it to state, at any rate,
that statutory prohibition on the President from creating a barrio does not,
in my opinion, warrant the inference of statutory prohibition for creating a
municipality. For although municipalities consist of barrios, there is
nothing in the statute that would preclude creation of new municipalities
out of pre-existing barrios.
It is not contrary to the logic of local autonomy to be able to create larger
political units and unable to create smaller ones. For as long ago
observed in President McKinley's Instructions to the Second Philippine
Commission, greater autonomy is to be imparted to the smaller of the two
political units. The smaller the unit of local government, the lesser is the
need for the national government's intervention in its political affairs.
Furthermore, for practical reasons, local autonomy cannot be given from
the top downwards. The national government, in such a case, could still
exercise power over the supposedly autonomous unit, e.g.,
municipalities, by exercising it over the smaller units that comprise them,
e.g., the barrios. A realistic program of decentralization therefore calls for
autonomy from the bottom upwards, so that it is not surprising for
Congress to deny the national government some power over barrios
without denying it over municipalities. For this reason, I disagree with the
majority view that because the President could not create a barrio under
Republic Act 2370, a fortiori he cannot create a municipality.
It is my view, therefore, that the Constitution, and not Republic Act 2370,
repealed Section 68 of the Revised Administrative Code's provision
giving the President authority to create local governments. And for this
reason I agree with the ruling in the majority opinion that the executive
orders in question are null and void.
In thus ruling, the Court is but sustaining the fulfillment of our historic
desire to be free and independent under a republican form of
government, and exercising a function derived from the very sovereignty
that it upholds. Executive orders declared null and void.